The phasing out of the Bush administration’s tax cuts, changes in reporting of 1099 income, and tax increases related to the health care bill are just around the corner. Will these have a negative effect on the fledgling real estate recovery?
Regardless of where you stand politically, there are big changes coming that can have a significant impact on the real estate industry. The biggest challenge is that thousands of pages of legislation have been signed into law, but the rules and regulations that determine how the law is administered are still being written. As a result, it’s very hard for anyone to know exactly what to expect until the rules and regulations are published.
For example, the health care bill changes how "miscellaneous income" is reported. The original bill seems to require anyone who purchases $600 or more of business products to issue a Form 1099-MISC to the company from whom they purchased the product. In other words, if I buy $600 of office supplies at Staples, I have to give Staples a Form 1099.