The Senate approved a bill Thursday night that both modernizes the Federal Aviation Administration’s technology and includes a provision that repeals the health care reform bill’s expanded 1099 information reporting requirements.

The Senate had approved a 1099 repeal amendment for the FAA reauthorization bill on February 2 (see Senate Passes 1099 Repeal Amendment). But further amendments and debate over other provisions of the bill, which would provide the FAA with improved air traffic control technology and other air transportation safety and infrastructure improvements, along with an Airline Passengers Bill of Rights, continued for another two weeks in the Senate.

The 1099 provision would repeal the requirements in last year’s health care reform bill forcing businesses to report any purchases of goods or services totaling over $600 a year from any other business. The House Ways and Means Committee also approved a bill that would repeal the same requirements, along with further 1099 information reporting requirements for rental property businesses that were originally included in last year’s Small Business Jobs Act (see House Panel Approves 1099 Repeal Legislation). The House is likely to take up the bill after it returns from a holiday recess.

However, the House legislation uses a controversial offset to pay for the cost of repeal involving repayments by low-income and middle-class taxpayers who had received health insurance subsidies and tax credits under the health care reform bill, but who then earned too much to qualify to receive the subsidies and would have to give them back in full.

House Democrats on the Ways and Means Committee voted against the 1099 repeal bill because of the offsets, saying they violated an earlier understanding with House Republicans. The Senate's FAA Reauthorization Act, which was approved by an 87-8 vote, instead uses unspecified spending cuts to pay for the cost of the 1099 reporting repeal. The House has not yet voted on the FAA bill or added a 1099 repeal amendment to it.

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