Form 1099 Due Diligence: Avoid Costly Mistakes
Please see below for additional instructions and information regarding this program.
The seemingly never-ending and complicated changes to the 1099 forms require you to stay diligent. Reporting issues are commonly a top priority and there is no better way to stay up to date on the issues, exercise best practices, practice due diligence, and avoid costly mistakes. The IRS thinks Forms 1099 are important. They asked and Congress agreed to increase the failure to timely file and the failure to file a correct Information Return penalties for Forms filed. This webinar will go over developing a best practices manual and includes helpful hints on ways to avoid potential penalties and those time consuming “B” Notices.
What better way to prepare for the coming Form 1099 filing season that to learn current preparing and filing guidelines, along with the latest helpful hints.
- What’s New – Filing Dates
- What’s New – Penalty Increases and Abatements
- Compliance Responsibility of Income Tax Preparer
- Compliance Responsibility of Payer
- Definition of Due Diligence
- Identifying Types of Payments Requiring 1099s
- Identifying Types of Entities Who Should Receive a 1099
- Most Common 1099 Mistakes
- Use IRS e-Services to Avoid TIN and Name Matching Problems
Overview: Foundational Laws - 00:01:00
What’s New in the 1099 World - 00:02:39
Due Diligence and the W-9 - 00:29:25
1099 Problem Payees - 00:48:21
1099 and Accountable Plans - 00:56:40
1099 and The Exempt Organization - 00:59:10
Verifying Payee 1099 Data - TIN Match Program - 01:01:48
1099 Reporting - The Basics - 01:05:29
Due Diligence: Backup Withholding - 01:07:08
Due Diligence: B-Notices - 01:10:28
Avoiding Penalties: B-Notices - 01:12:20
Reporting on the 1099-MISC - 01:13:14
Closing / Q&A - 01:19:25
B-Notice - 01:08:20, 01:10:28
Backup Withholding - 01:07:08
C-Notice - 01:08:20
Form 1042-S - 00:44:20
- B - 00:29:25
- DIV - 00:29:25
- INT - 00:29:25
- MISC - 01:05:29, 01:13:14
- OID - 00:29:25
- PATR - 00:29:25
Form 8832 - 00:49:30
Form 941 - 01:10:00
Form 945 - 01:10:00
IRC Chapter 4 (FATCA) - 00:01:00
- 274 - 00:13:50
- 1441 - 00:01:00
- 3406(a) - 00:01:00, 01:07:08
- 6041 (a) - 00:01:00
- 6050W - 00:42:00
- 6109(a) - 00:01:00
ITIN - 00:46:50
Select Check - 00:59:10
Tax Cuts and Jobs Act - 00:13:50
B-Notice: A notice from the IRS stating that one or more tax ID numbers were missing from a 1099 or do not match the IRS records.
Backup Withholding: Backup withholding is the tax that is levied on investment income, at an established tax rate, as the investor withdraws it. Backup withholding helps to ensure that government tax-collecting agencies (such as the IRS or Canada Revenue Agency) will be able to receive income taxes owed to them from investors' earnings. (www.investopedia.com)
Form 1099 MISC: The Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payments made to nonemployee individuals, such as independent contractors, during the calendar year. (www.shrm.org)
IRC Section 6041(a): Provides that persons engaged in trade or business must report certain payments on an information return.
IRC Section 3406(a): Requires that, under certain circumstances, including failure ot payee to provide a TIN, the payer must perform backup withholding.
IRC Section 1441: Requires that, under certain circumstances, payers must perform 30% back up withholding on US sourced payments made to non-resident aliens.
IRC Chapter 4 (FATCA): Creates a due diligence obligation for US Withholding Agents to verify payee identity when it involves virtually any cross-border payment.
Limited liability company (LLC): An LLC is a corporate structure where members cannot be held accountable for the company’s debts or liabilities. This can shield business owners from losing their entire life savings if, for example, someone were to sue the company. Can be a single member (much like a sole proprietor) or a multi-member. It shares certain traits of both corporations as well as partnerships or sole proprietorships. It is not a corporation.
Safe Harbor: A safe harbor is a provision of a statute or a regulation that specifies that certain conduct will be deemed not to violate a given rule. It is usually found in connection with a vaguer, overall standard. (en.wikipedia.org)
Form W-9: Form W-9 (officially, the "Request for Taxpayer Identification Number and Certification") is used in the United States income tax system by a third party who must file an information return with the Internal Revenue Service (IRS). It requests the name, address, and taxpayer identification information of a taxpayer (in the form of a Social Security Number or Employer Identification Number). - Wikipedia (https://en.m.wikipedia.org/)
C-Notice: Backup withholding notice from the IRS stating that the non-employee has understated income and is subject to backup withholding.
Steven Mercatante is the principal and founder of TIR Consulting, LLC. He is a nationally recognized leader in tax reporting education and consulting on specialized compliance issues. He has conducted on-site consultation for corporate clients from across the world and led countless seminars and webinars for Convey Compliance Systems, IAPP, Balance Consulting, The Accounts Payable Network, Accounts Payable Now and Tomorrow, Progressive Business Conferences, The Center For Competitive Management,... View Full Profile
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