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Showing posts from December, 2016

The Importance of TIN Match

The IRS recently raised its penalties on incorrect and late filings (again). TIN match can potentially help you save yourself or your clients some money.
What is TIN Match? It’s a tool to confirm the name and taxpayer identification number for 1099 vendors. We check the information for you with the IRS database. That way you know you are filing with the most correct information.
Can I Do TIN Match Myself? Yes! You can register with the IRS E-Services tool. Plan on the process taking a few weeks to complete. The IRS needs to confirm your SSN and name along with some tax details you enter. Then they will send you a login ID and password via the US Postal Service.
Once you receive the login, you will have several steps to complete:
Login to the site.Select the organization you will represent during the session.Select TIN Matching.Accept the TIN Matching Terms of Agreement.Choose to begin an Interactive or Bulk Session.Interactive Session in step 5 - you can enter between 1 and 25 TIN and N…

8 Mistakes 1099 Filers Make

After years of handling 1099's, we've seen some … interesting filings. We’ve collected a few below as things you might want to watch out for when completing your filing. We've removed all identifying characteristics to protect the filers.
The Incorrect Corrected Filing This will be important with the earlier filing deadline for W-2's and Box 7 on the 1099-MISC forms. When filing a corrected form, be sure to check the box marked “Corrected” at the top of the page. I know. We were surprised to hear from someone that they had not done that on their Corrected form, too. But it can be easy to miss. The good thing about Corrected forms is you can always do another one – and be sure to check the box at the top. (As an aside, we need a better term for “incorrect corrected filings.” Please make suggestions in the comments box at the bottom.) Typos in the TIN and Name The IRS actually checks TIN-name matches against their database. When they find the information that doesn’t match the…

Data Collection for Vendors via W-9

“What do I do about a vendor who won’t give me his taxpayer ID?” We hear that question a lot. You could:
Not pay them until you get it. This translates to “don’t hire someone until they complete the paperwork.” Begin backup withholding until they provide the TIN. This is what the IRS says you have to do. That doesn’t help, though, when you have already made the payment and need to file your 1099-MISC for the vendor. You need to collect a W-9 so you file the 1099 with accurate information. W-9 Basics The W-9 is a standard IRS form. The form allows payers to collect information they need to file a return showing a payment made. It asks for your vendors' TIN, name, entity type, address, and a few other pieces of info. But it’s the TIN that some payees don’t want to provide. Why not? There are a lot of reasons: Reasonable: “I can’t remember my EIN but will get it and complete this tomorrow” Illegal: “I opted out of paying taxes. There is no need for me to give that to you, because I don’t …