Discussion:1099's with wrong "Recipient's Identification Number"
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Discussion Forum Index --> Basic Tax Questions --> 1099's with wrong "Recipient's Identification Number"
Discussion Forum Index --> Tax Questions --> 1099's with wrong "Recipient's Identification Number"
IheartTaxes (talk|edits) said: | 19 February 2008 |
| What do I do?
Taxpayer was issued several 1099's for work done during 2007. More than half of the 1099's the Taxpayer received have incorrect recipient EIN #'s. Therefore, less than half of Taxpayer's 1099's have correct EIN #'s. What should I do? Can someone plese tell me what they think the best way to handle this would be? Thank you for your help. | |
| February 19, 2008 | |
| Hmmmm, is it a coincidence that several payors entered the wrong EIN or is it the taxpayer filling out the W-9's incorrectly? Gotta wonder. I would request issuer to correct the 1099s. Ask them to pull the W-9s to see if taxpayer entered his EIN correctly. Remind taxpayer that his income is based on what he actually received even if s/he didn't receive a 1099. | |
| 19 February 2008 | |
| EIN has 2 #'s in the beginning, SS#, has 3 #'s. Could be the "dash" is in the wrong place....even if the 1099 is incorrect; a penalty for the payor...the payee should report it...are the 1099's indicative of the monies earned? If so, file it and then the payor has a penalty of $50.00 for each reporting error :) | |
| 19 February 2008 | |
| IRS is not likely to penalize the payer, but we need not care about that anyway. We report all income received (if cash basis), 1099's notwithstandng. Payee is not obligated to contact the payer at all. | |
Bottom Line (talk|edits) said: | 20 February 2008 |
| Payer will eventually get a mismatch letter from the IRS. Would be NICE for payee to get this straightened out now. | |
| 20 February 2008 | |
| I still don't understand why the payee has to get involved. | |
Bottom Line (talk|edits) said: | 20 February 2008 |
| When the payer gets a letter about the mismatch from the IRS two years from now, the payer will panic and make a phone call. That phone call will either be to the payee or to the payer's accountant. | |
Robmorris61 (talk|edits) said: | 17 March 2008 |
| I have a similar 1099 question. A corporation we work with has an asset that is being held by a 3rd party, in a storage area. They have no choice except pay the amount in question to get possession of the item. However, the third party refuses to supply his taxpayer ID. Is there a way to pay only the amount due and supply the information they have to the IRS, or should they in effect pay the taxes by grossing the amount up and paying the withholding? | |
Actionbsns (talk|edits) said: | 17 March 2008 |
| That's a natty problem. There is an allowance for backup withholding, but from what you are suggesting, they already need to pay this person XXX amount of money and they don't sound as though they have a friendly relationship. So grossing up by 25% or so for the allowed withholding makes the bill that much higher and, in the end, the third party comes out smelling like a rose since he now has the rental money and some withholding paid on his taxes. They could threaten to send in the 1099 without the ID number and provide IRS with "refused to provide". If they have the correct legal name and address of this person, IRS would then have the information they need to cranky about the whole thing. Sometimes that will shake loose the number. | |
Scottycoyote (talk|edits) said: | 17 March 2008 |
| i would just tell the taxpayer they need to claim whatever income they received in 2007, and that they should contact the payee so it can be corrected for any future payments. Of course the payer will prob get a letter from the irs about mismatches later, and if the payee doesnt get his/her ein# corrected with them the payer may have to do backup withholding if they pay your client more money (as someone else stated). But if this was a onetime thing and the client wont be dealing with the payers anymore then its not the clients problem,as long as they are claiming their proper income amount. | |
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