Washington, D.C. , Oct 25 - By Randy Tucker; Dayton Daily News

Miami Valley small business owners fear they could find themselves buried in additional paperwork stemming from a new tax rule attached to the Health Care Act.

Set to take effect in 2012, the provision would require all businesses, no matter how small, to submit 1099 forms for any vendor they pay more than $600 a year.

That means local start-ups and mom-and-pop shops with limited bookkeeping resources would have to collect tax ID information and file 1099 forms for every gas station or office supply store they spend $600 with to support their business.

Businesses currently are required to file 1099 forms only for income paid to service providers who are not direct employees, such as independent contractors or self-employed freelance writers.

Proponents of the new law said it would generate $17 billion in taxes on under-reported income to help pay for expanded health care.

“There has got to be a better way,’’ said Ed Fritz, owner of Centerville Coin & Jewelry Connection. “It’s just creating a big headache for small business owners. It won’t affect me as much as others because I have a full-time accountant. That’s what it’s going to take to keep up with these new reporting laws.’’

The new law could be especially onerous on brokerlike businesses, such as coin dealers and pawn shops, which get much of their inventory from customers.

If those businesses spend more than $600 with a customer at one time or over the course of a year, the business owner would have to get each customer’s tax ID and send them a 1099 form.

“I have a lot of customers who get loans of $600 or more, and to think I’d have to report every one of those... Oy vey,” said Dave Bertke, owner of Rich’s Pawn Shop on Watervliet Avenue in Dayton.