Easiest way is through bank records - both yours and theirs. First, the IRS can link to theirs and get a record of who they paid. Then, cross-reference to the bank accounts of the payees (you). Business account or not wont matter. Those checks were deposited in your account. Cross-reference this to your tax return and determine - Was this income declared? If a 1099 wasn't issued, it would have been declared on a separate line of Schedule C - something like "Other Income". Oh, you didn't file Schedule C? That's Tax Evasion. Oh, you don't need to pay tax on everything that you received because you paid half that to get it in the first place? Did you keep a record of what you paid? No? Then you owe tax on the entire amount received, plus interest and penalties.
The new 1099 law is simply a redundancy of current reporting provisions designed to give the IRS more ammunition for prosecution.