According to Blackman Kallick, an accounting firm that puts out a great e-newsletter, "businesses must currently file a 1099 form for purchases of services from non-corporate entities. Enacted with the purpose of raising revenue, the PPACA provisions would have required 1099 reporting for all transactions in excess of $600." However, the previous bill included exclusions for reporting requirements for those vendors paid via credit-card based mechanisms (since the income of these providers are already tracked). One of our hypotheses -- had the bill been enacted -- was that in addition to the card providers/issuers, other future winners of the legislation may have included supplier network providers and P2P vendors which could have provided similar traceability without requiring manual reporting efforts at year end.
It seems there are many reasons to move to a completely paperless environment when it comes to invoicing and payment (not to mention other documentation exchange -- POs, ASNs, etc.) outside of the regulatory requirements that have driven adoption throughout Europe, especially in the Nordics. In the future, we suspect supplier networks that drive electronic invoicing and payment, whether run by software companies like Ariba, Hubwoo, Basware or the banks themselves, will become ubiquitous in business-to-business transactions. But legislation like the provisions contained in PPACA may have helped drive adoption sooner. Ironically, despite the additional reporting requirements of the now-cancelled bill, I suspect the net productivity, financial/working capital visibility and related gains from getting away from B2B paper that it may have eventually enabled, might have been greater than the immediate 1099 reporting hassles the legislation promised to bring. Alas, now we'll never know.