On Demand Webinar

Form 1099 Due Diligence: Avoid Costly Mistakes

Webinar Details $219

  • Rated:
  • Webinar Length: 100 Minutes
  • Guest Speaker:   Steven Mercatante
  • Topic:   Taxation and Accounting
  • Credit:   CPE 2.0, ATATX 1.5
All Access Membership

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.

Current Topics:

  • 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

Forms 1099:

  • 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
  1. Introduction
  2. IRS Focus: The Tax Gap 00:02:24
  3. The Law Learn it, Know it, Live it 00:09:06
  4. What’s New Big 1099 Filing Changes Coming - FIRE 00:19:10
  5. What’s New Big 1099 Filing Changes Coming - FIRE/E-Filing 00:23:39
  6. What’s New Big 1099 Filing Changes Coming - New Rules 00:28:29
  7. The Form 1099 NEC Versus 1099 MISC 00:33:58
  8. The Form 1099 NEC Versus 1099 MISC - Reportable Payments 00:38:16
  9. The Form 1099 NEC Versus 1099 MISC - Other Implications 00:40:20
  10. What’s New With The 2021 Form 1099 MISC 00:46:04
  11. 1099 MISC Box One Issues 00:48:37
  12. 1099 MISC Box Two Issues 00:51:09
  13. 1099 MISC Box Three Issues 00:52:19
  14. 1099 MISC Box Six Issues 00:55:36
  15. 1099 MISC vs. 1099 NEC Director’s Payments 00:56:26
  16. The 2021 Form 1099 MISC is Far Less Comprehensive Than in Past Years - Nonreportable Payments 00:58:18
  17. The 2021 Form 1099 NEC vs. 1099 MISC - Your Action Steps 00:59:44
  18. The “Other 1099’s”: The 1099 K 01:05:53
  19. The “Other 1099’s”: The 1099 R 01:13:10
  20. The “Other 1099’s”: The 1099-INT, 1099-B, 1099-DIV, 1099-C 01:17:37
  21. 1099 Due Diligence Starts With The W 9 01:25:24
  22. 1099 Due Diligence Starts With The W 9: Name and TIN “Cheat Sheet” 01:27:58
  23. 1099 Due Diligence Starts With The W 9: Name and TIN “Cheat Sheet” Cont’d 01:28:11
  24. 1099 Due Diligence Starts With The W 9 - When to Get an Updated Form W 9 01:28:44
  25. 1099 Due Diligence Starts With The W 9 - Payee Refuses to Provide a TIN 01:30:21
  26. 1099 Due Diligence Data Validation Basics - Identifying Your Payee 01:31:13
  27. 1099 Due Diligence Data Validation Basics - U.S. Persons 01:31:39
  28. 1099 Due Diligence: Always Validate Claims of Non Reportability - Corporations 01:32:04
  29. 1099 Due Diligence: Always Validate Claims of Non Reportability - LLC’s -The LLC 01:32:25
  30. 1099 Due Diligence: Always Validate LLC’s - The LLC as the Disregarded Entity 01:32:52
  31. 1099 Due Diligence & Data Validation: The Exempt Organization - Tax Exempt Organization Search Tool 01:33:33
  32. 1099 Due Diligence & Data Validation: TIN Match Program 01:34:02
  33. 1099 Due Diligence & Data Validation: TIN Match Program - The W-9 and Vendors 01:35:18
  34. 1099 Due Diligence & Data Validation: TIN Match Program - Using The Tool 01:35:30
  35. 1099 Due Diligence & Data Validation: TIN Match Program - Delegated Authority 01:35:40
  36. 1099 Due Diligence & The Middleman 01:35:56
  37. 1099 Due Diligence & B Notice Response Best Practices - B-Notice Reasons 01:36:22
  38. 1099 Due Diligence & B Notice Response Best Practices - 1st Notice 01:37:00
  39. 1099 Due Diligence & B Notice Response Best Practices - 2nd Notice 01:37:33
  40. Protect Yourself 01:38:29
  41. Attendee Questions 01:38:55
  42. Presentation Closing 01:42:49
  • Audit 00:04:46, 00:15:36
  • Backup Withholding 00:10:51, 00:15:45, 01:01:24, 01:37:25
  • B-Notice 00:11:20, 01:34:27, 01:36:22
  • CP-2100 00:11:19, 01:37:10
  • Disregarded Entity 01:26:16
  • EIN 01:29:57
  • FIRE - File Information Returns Electronically 00:19:55
  • Form 1042 00:20:49
  • Form 1042-S 00:20:49 
  • Form 1099-B 01:18:47
  • Form 1099-C 01:20:55
  • Form 1099-DIV  01:18:47, 01:34:02
  • Form 1099-INT 01:17:43, 01:34:02
  • Form 1099-K 01:05:58, 01:34:02
  • Form 1099 MISC 00:12:58, 00:34:03, 00:46:09, 00:56:57, 01:34:02
  • Form 1099-NEC 00:12:57, 00:34:02, 00:40:26, 00:56:33, 01:34:02
  • Form 1099-OID 01:34:02
  • Form 1099-PATR 01:34:02
  • Form 1099-R 01:13:17
  • Form 8832 01:32:25
  • Form 990 01:33:51
  • Form W-8 01:07:27, 01:31:32
  • Form W-9 01:25:24
  • IRC Section 3406(a) 00:09:25, 01:30:32
  • IRC Section 6041(a) 00:09:23
  • IRC Section 6109(a)(2) 00:09:25
  • Limited liability company (LLC) 00:38:40, 01:26:32. 01:32:26
  • Resident Alien 01:32:42
  • Sole Proprietor 01:26:32
  • Tax Exempt Organization Search Tool 01:33:43
  • Tax Gap 00:02:51
  • TIN 00:09:59, 00:13:16, 00:35:36, 01:26:25
  • TIN Match Program 01:34:04
  • Transmitter Control Code (TCC) 00:20:57
  • Vendors 00:09:45, 00:15:18

Audit: A formal examination of an organization's or individual's accounts or financial situation

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)

CP-2100: It is a notice that tells a payer that he or she may be responsible for backup withholding. It isaccompanied by a listing of missing, incorrect, and/or not currently issued payee TINs. Largevolume filers will receive a CD or DVD data file CP2100, mid-size filers receive a paper CP2100, andsmall filers receive a paper CP2100A.

Disregarded Entity: A disregarded entity refers to a business entity with one owner that is not recognized for tax purposes as an entity separate from its owner. A single-member LLC ( “SMLLC”), for example, is considered to be a disregarded entity. (www.pntax.com)

EIN: The Employer Identification Number, also known as the Federal Employer Identification Number or the Federal Tax Identification Number, is a unique nine-digit number assigned by the Internal Revenue Service to business entities operating in the United States for the purposes of identification.

FIRE - File Information Returns Electronically: The IRS FIRE system is the electronic network used to accept and process most types of filing forms. Technically, it stands for File Information Returns Electronically.

Form 1042: Form 1042, also "Annual Withholding Tax Return for U.S. Source Income of Foreign Persons", is used to report tax withheld on certain income of foreign persons.

Form 1042-S: Form 1042-S is used to report amounts paid to foreign persons (including persons presumed to be foreign) who are subject to income tax withholding. For an individual taxpayer, Form 1042-S is a document provided to you (and the IRS) by the payer of the income reported.

Form 1099 MISC: The Form 1099-MISC is an Internal Revenue Service (IRS) tax return document used to report miscellaneous payment?s made to nonemployee individuals, such as independent contractors, during the calendar year. (www.shrm.org)

Form 1099-B: Proceeds From Broker and Barter Exchange Transactions is an Internal Revenue Service (IRS) tax form that is issued by brokers or barter exchanges. The form lists the gains or losses of all broker or barter exchange transactions.

Form 1099-C: According to the IRS, nearly any debt you owe that is canceled, forgiven or discharged becomes taxable income to you. You'll receive a Form 1099-C, "Cancellation of Debt," from the lender that forgave the debt.

Form 1099-DIV : Form 1099-DIV: Dividends and Distributions is an Internal Revenue Service (IRS) form sent to investors who receive distributions from any type of investment during a calendar year. Investors can receive multiple 1099-DIVs. Each Form 1099-DIV should be reported on an investor's tax filing.

Form 1099-INT: Form 1099-INT is the IRS tax form used to report interest income. The form is issued by all payers of interest income to investors at year end and includes a breakdown of all types of interest income and related expenses. Payers must issue Form 1099-INTs for any party to whom they paid at least $10 of interest during the year.

Form 1099-K: A payment settlement entity (PSE) must file Form 1099-K for payments made in settlement of reportable payment transactions for each calendar year. A PSE makes a payment in settlement of a reportable payment transaction, that is, any payment card or third party network transaction, if the PSE submits the instruction to transfer funds to the account of the participating payee to settle the reportable payment transaction.

Form 1099-NEC: In the context of 1099 tax filing, NEC stands for “Nonemployee Compensation” (the first letters of the three words None, Employee and Compensation). Most tax payers recognize NEC as box 7 on Form 1099-MISC. NEC is used to report income paid to independent-contractors / the-self-employed (referred to as 1099 employees for simplification purposes). So, while employers report income that gets paid to employees on Box 1 (Wages, tips, other compensation) of the W2 form, payers report income that gets paid to none-employees on Box 7 (NEC) of the 1099-MISC form. As an individual, if you received form 1099-MISC instead of Form W-2 then the payer did not consider you an employee and did not withhold income tax or social security and Medicare tax.

Form 1099-OID: Form 1099-OID is a tax form intended to be submitted to the Internal Revenue Service by the holder of debt instruments which were discounted at purchase to report the taxable difference between the instruments' actual value and the discounted purchase price.

Form 1099-PATR: File Form 1099-PATR, Taxable Distributions Received FromCooperatives, for each person to whom the cooperative has paidat least $10 in patronage dividends and other distributionsdescribed in section 6044(b), or from whom you withheld anyfederal income tax under the backup withholding rulesregardless of the amount of the payment.

Form 1099-R: Form 1099-R is a tax form from the Internal Revenue Service (IRS) for reporting distributions from annuities, profit-sharing plans, retirement plans, IRAs, insurance contracts, or pensions.

Form 8832: Form 8832 is the Entity Classification Election form from the IRS. It is filed to elect a tax status other than the default status for your entity. For example, an LLC can elect to be taxed as a C Corporation.

Form 990 : Form 990 (officially, the "Return of Organization Exempt From Income Tax") is a United States Internal Revenue Service form that provides the public with financial information about a nonprofit organization. It is often the only source of such information.

Form W-8: Form W-8 is filled out by foreign entities (citizens and corporations) in order to claim exempt status from certain tax withholdings. The form is used to declare an entity's status as non-resident alien or foreign national who works outside of the United States.

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/)

IRC Section 3406(a): Requires that, under certain circumstances, including the payee's failure to provide a TIN, the payer must perform backup withholding.

IRC Section 6041(a): Provides that persons engaged in trade or business must report certain payments on an information return.

IRC Section 6109(a)(2): Requires that a payee provide a TIN to the payer when the payment will be reportable on an information return.

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.

Resident Alien : A resident alien is a foreign person who is a permanent resident of the country in which he or she resides but does not have citizenship. To fall under this classification in the United States, a person needs to either have a current green card or have had one in the previous calendar year.

S Corporation: An S corporation, for United States federal income tax, is a closely held corporation that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code. In general, S corporations do not pay any income taxes.

Sole Proprietor: A business that legally has no separate existence from its owner. The sole proprietorship is the simplest business form under which one can operate a business. The sole proprietorship is not a legal entity. It simply refers to a person who owns the business and is personally responsible for its debts.

TIN: A Taxpayer Identification Number is an identifying number used for tax purposes in the United States and in other countries under the Common Reporting Standard. In the United States, it is also known as a Tax Identification Number or Federal Taxpayer Identification Number.

TIN Match Program: TIN Matching is part of a suite of Internet-based pre-filing e-services that allows “authorized payers” the opportunity to match 1099 payee information against IRS records prior to filing information returns.

Tax Exempt Organization Search Tool: Tax Exempt Organization Search helps users find information about a tax-exempt organization’s federal tax status and filings.

Tax Gap: The gross tax gap is the difference between true tax liability for a given tax year and the amount that is paid on time. It is comprised of the nonfiling gap, the underreporting gap, and the underpayment (or remittance) gap.

Transmitter Control Code (TCC): The Transmitter Control Code (TCC) is an identifier that the IRS uses to distinguish different electronic filing companies. It's necessary when you need to file for a correction. Getting a TCC depends on how you file your 1099 forms

Vendor: A vendor is a person or business that supplies goods or services to a company. Another term for the vendor is the supplier. In many situations, a company presents the vendor with a purchase order stating the goods or services needed, the price, delivery date, and other terms.


Guest Speaker

  • Steven Mercatante

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