By Julian Pecquet - 02/14/11 11:03 PM EST
Still, the administration's budget proposal has tax attorneys scratching their heads; the president himself criticized the healthcare law's reporting requirement in his State of the Union address and the Senate has already voted to repeal it. The Ways and Means Committee is due to mark up the House version of repeal legislation on Thursday.
"This proposal seems like it may be backing off the Obama position of supporting repeal," said Christopher Hatcher, a tax attorney with the Williams and Jensen law firm.
The White House Office of Management and Budget explained the rationale in its Analytical Perspectives.
"The Administration recognizes the burden that this expanded information reporting provision will put on small businesses and proposes to repeal the provision," the document says. "Instead, the Administration proposes that a business be required to file an information return for payments for services or for determinable gains aggregating to $600 or more in a calendar year to a corporation (except a tax-exempt corporation); information returns would not be required for payments for property."
The proposal is expected to raise about $10 billion over 10 years.