Publication 1586 (2-2016) REASONABLE CAUSE REGULATIONS AND REQUIREMENTS FOR MISSING AND INCORRECT NAME/TINs (INCLUDING INSTRUCTIONS FOR READING CD/DVDS AND MAGNETIC MEDIA)
Publication 1586 (2-2016)
- Institutional AuthorsInternal Revenue Service
- Jurisdictions
- LanguageEnglish
I. INTRODUCTION
Purpose:
This publication
• provides general information needed to avoid penalties under IRC sections
6721through 6724 for information return documents that are filed with missing or incorrect taxpayer identification numbers (TINs),
• describes the actions that must be taken, or should have been taken, to solicit (request) a TIN, and
• explains the requirements for establishing reasonable cause.
Applicable Regulations
Treasury Regulations affecting all persons who may be subject to penalty for failure to comply with the information reporting requirements under the Internal Revenue Code (IRC) include, but are not limited to:
• 301.6721-1, Failure to file correct information returns
• 301.6722-1, Failure to furnish correct payee statements
• 301.6723-1, Failure to comply with other information reporting requirements
• 301.6724-1, Reasonable cause
Other regulations that apply to specific forms may supersede all or parts of these regulations. Examples of such regulations include, but are not limited to:
• 1.6045-4, Information reporting on real estate transactions with dates of closing on or after January 1, 1991 (Form 1099-S,
Proceeds From Real Estate Transactions)
• 1.6050H-2, Time, form, and manner of reporting interest received on qualified mortgage (Form 1098, Mortgage Interest Statement)
• 1.6050S-1, Information reporting for qualified tuition and related expenses (Form 1098-T, Tuition Statement)
• 1.6050S-3, Information reporting for payments of interest on qualified education loans (Form 1098-E, Student Loan Interest Statement)
• 1.6055-1 and 1.6055-2, Information reporting for minimum essential coverage (Form 1095-B, Health Coverage)
• 301.6056-1, Rules relating to reporting by applicable large employers on health insurance coverage offered under employer-sponsored plans (Form 1095-C, Employer-Provided Health Insurance Offer and Coverage)
What's New
• Various editorial changes have been made throughout the publication including, but not limited to, clarifying the solicitation requirements in Parts V and VI.
• Updated penalty rate tables to include new rates for information returns required to be filed on or after January 1, 2016
• Inflation increases to penalty rates for certain information returns required to be filed on or after January 1, 2016.
• Form 1094-C, Transmittal of Employer-Provided Health Insurance Offer and Coverage Information Returns
• Form 1095-B, Health Coverage
• Form 1095-C, Employer-Provided Health Insurance Offer and Coverage
II. THE PENALTY FOR MISSING TINS AND INCORRECT NAME/TIN COMBINATIONS
Internal Revenue Code (IRC) section 6721, Failure to File Correct Information Returns, imposes a penalty per return for each of the following infractions related to information returns:
• Filed with a missing/incorrect TIN (or other incorrect information),
• Filed untimely,
• Filed on paper when filing electronically was required,
• Filed in an incorrect format, or
• Any combination of the above
The penalty may be reduced:
• if the error or omission is corrected within 30 days of the required filing date, or
• if the error or omission is corrected after the 30 - day period, but by August 1 of the year the return is required to be filed.
The maximum penalty that may be imposed for one person for all such failures in a calendar year depends on the tax year of the return. For example, the maximum penalty for tax year 2014 is:
• $1,500,000 (Large businesses with gross receipts over $5 million), or
• $500,000 (Small businesses with gross receipts of $5 million or less)
Note
-- There are no maximum penalty limitations for failures that are due to intentional disregard.
Refer to Part VIII for the applicable penalty rates and maximum penalty amounts depending on the tax year of the return. These penalty rates and maximum penalty amounts are subject to inflation increases as required by IRC section • Ten information returns, or • One-half of one percent of the total number of all information returns required to be filed during the year.
The penalty may be waived by showing the failure(s) was due to reasonable cause and not due to willful neglect.
To support the showing that the failure to include a correct TIN was due to reasonable cause and not willful neglect, filers must establish that they acted in a responsible manner both before and after the failure occurred and that:
• there were significant mitigating factors (for example, an established history of filing information returns with correct TINs), or
• the failure was due to events beyond the filer's control (for example, the unavailability of relevant business records as a result of a fire or other casualty that prevented timely processing and filing of the required forms).
Except as otherwise stated in this publication, acting in a responsible manner generally includes making an initial solicitation (request) for the payee's name and TIN and, if required, an annual solicitation. Upon receipt of this information, it must be used on any future information returns filed. Refer to Treas. Reg. 301.6724-1 for all reasonable cause guidelines.
IV. NOTICE 972CG, NOTICE OF PROPOSED CIVIL PENALTY
Proposed Penalty Notice
Notice 972CG, with a listing of the information returns filed with missing or incorrect name/TIN combinations, will be sent to filers of information documents subject to penalty under IRC section 6721. Notice 972CG proposes a penalty for each return not filed correctly. The listing should be compared with the filer's records to determine if:
• appropriate action was taken (see Part VI) to meet the requirements for establishing reasonable cause, and
• an annual solicitation must be made in the current year to avoid penalties in future years.
Notice 972CG may include proposed penalties for late filing and/or failure to file information returns electronically. If a notice includes these penalties, a written explanation must substantiate reasonable cause in order to have the proposed penalties waived.
The Contents of Notice 972CG include:
• An explanation of the proposed penalty,
• An explanation of how to respond to the notice,
• A record of each submission considered in the total penalty, including the form type, date received (if not timely filed), whether the returns were original or corrected, the transmitter control code (for electronic filers), and the type of penalty that applies (or penalties that apply).
• A summary of the proposed penalty, which takes into consideration all penalties proposed, and the maximum penalty amount that can be assessed under IRC section 6721, and
• A response page.
Reminder: The response page and the payment slip are the only pages of the notice that should be returned to the Internal Revenue Service with proof of solicitation or with a written explanation substantiating reasonable cause.
Please send in the portion of the payment slip that is appropriate to your response (i.e., fully agree, partially agree, or totally disagree) with the proposed penalty. Please sign in the space provided and submit payment if fully or partially agreeing to the proposed penalty.
How to Answer Notice 972CG
• The notice has to be answered within 45 calendar days (60 days for foreign payers) from the notice date.
• If more time is needed, submit a written request to the address listed on the notice before the end of the 45 day (60 days for foreign payers) period.
• Explanations should be as detailed as possible to limit the number of contacts required to establish reasonable cause, and should provide an explanation of the steps taken to comply with the Internal Revenue Code and regulatory provisions.
• Do not submit copies of the solicitations unless requested by an IRS employee.
• If reasonable cause is established, IRS Letter 1948C will be issued stating that the explanation given was accepted.
• If the reply does not establish reasonable cause, or only partially establishes reasonable cause, a penalty will be assessed. A balance due notice will be sent (CP15/215) with a separate letter explaining any appeal rights.
• Agreement to the proposed penalty should be submitted with a payment and the response page (or signed consent statement on the response page) and the payment slip to show agreement. A balance due notice (CP15/215) will be sent after receipt of the consent statement.
• No response to the Notice 972CG within 45 days (60 days for foreign payers) will result in assessment of the full amount of the proposed penalty and a balance due notice (CP15/215) being issued.
Note:
Interest accrues on the balance due from the date of the CP15/215 Notice (unless the penalty is paid within a specified number of days) and continues to accrue until the balance is fully paid. Interest charged on any penalty amount that is later decreased will be reduced accordingly.
A solicitation is a request by a payer for a payee to furnish a correct TIN. An initial solicitation must be made by a payer for a correct TIN when a transaction with an information reporting requirement is made unless the payer has the payee's TIN and uses that TIN for all transactions with the payee. Where a payee's TIN is missing or incorrect after the initial solicitation, the payer generally will need to conduct annual solicitations for a correct TIN. See Treas. Regs. 301.6724-1(e)(1), (f)(1).
A solicitation may be required if a payer receives a backup withholding notice based on an incorrect payee TIN (CP2100 or CP 2100A). If such a notice is received, the solicitation must be made pursuant to the backup withholding rules. See Publication 1281, Backup Withholding on Missing and Incorrect Name/TINs (including Instructions for Reading Tape Cartridges and CD/DVD Formats). In addition, payers are required to make solicitations in order to avoid information reporting penalties. Generally, such solicitations may be made in one of the following ways:
Annual Solicitations by Mail
Annual solicitations by mail must include three items to the payee:
1. A letter stating that the payee must provide an accurate TIN and that failure to do so may result in a $50 penalty under IRC section
6723per failure or incorrect document,
2. Form W-9, Request for Taxpayer Identification Number and Certification, as applicable (or a substitute document that is significantly similar to Form W-9). (See Publication 1281 for detailed instructions for Form W-9), and
3. A return envelope, which may be (but is not required to be) postage prepaid.
If the annual solicitation is for a missing or incorrect name/TIN required to be reported on Form 1099-R,
Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.,then Form W-4P,
Withholding Certificate for Pension or Annuity Payment,may be included along with Form W-9.
If the annual solicitation is for a missing or incorrect Social Security Number (SSN) required to be reported on Form W-2, Wage and Tax Statement, then Form W-4, Employee's Withholding Allowance Certificate, may be used.
If the annual solicitation is for a missing or incorrect SSN required to be reported on Form 1098-E or Form 1098-T, then Form W-9S, Request for Student's or Borrower's Taxpayer Identification Number and Certification, may be used.
Annual Solicitations by Telephone
In general, an annual solicitation may be made by phone if the solicitation procedure is designed and carried out in a manner that is conducive to obtaining the payee's TIN. However, telephone solicitations do not apply for missing or incorrect TINs on certain forms such as Form 1098-T. A telephone solicitation may be conducted by:
1. Calling each payee with a missing or incorrect name/TIN combination and speaking to an adult member of the household, or to an officer of the business or organization,
2. Requesting the payee's TIN,
3. Informing the payee of the $50 penalty under IRC section 6723 if the TIN is not provided,
4. Maintaining contemporaneous records showing that the solicitation was properly made, and
5. Providing the records to the IRS, if requested.
Note:
Annual solicitations are not required if payments were not made to the payee's account in the years in which the penalty notice is received or if no information returns are required for the account for that year.
Electronic Solicitations
Requesters may establish an electronic system for payees to receive and respond to solicitations. This also includes responding and receiving solicitations by fax. A requester is anyone required to file an information return. A payee is anyone required to provide a TIN to the requester. Generally, the electronic system must:
1. Ensure the information received is the information sent, and document all occasions of user access that result in the submission,
2. Make it reasonably certain the person accessing the system and submitting the form is the person identified on the Form W-4, W-9, or W-9S,
3. Provide the same information as the paper Form W-4, W-9 or W-9S,
4. Require as the final entry in the submission, an electronic signature by the payee whose name is on the Form W-4, W-9 or W-9S that authenticates and verifies the submission, and
5. Be able to supply a hard copy of the electronic Form W-4, W-9 or W-9S if the Internal Revenue Service requests it.
6. For Forms W-4, the signature must be under penalty of perjury. The electronic system must inform the employee that he or she must make a declaration contained in the perjury statement and that the declaration is made by signing the Form W-4. See Regulations section
Note: While you may establish an electronic system to receive Forms W-4 from your employees, you should make a paper option reasonably available upon request to any employee who has a serious objection to using the electronic system or whose access to or ability to use the system may be limited (for example, as a result of a disability).
VI. ACTIONS FOR MISSING TINS AND INCORRECT NAME/TIN COMBINATIONS
Missing TINs
TINs can be a SSN, an Employer Identification Number (EIN), an Individual Taxpayer Identification Number (ITIN), or an Adoption Taxpayer Identification Number (ATIN). SSNs are assigned by the Social Security Administration (SSA). EINs, ITINs, and ATINs are assigned by the IRS. If a TIN is not provided or is obviously incorrect, it is considered missing. TINs lacking nine numerical digits or containing alpha characters are considered obviously incorrect. The general requirements for payee accounts with missing TINs are:
1. Complete an initial solicitation at the time the account is opened. The term "account" includes accounts, relationships, and other transactions. If a TIN is not received as a result of the initial solicitation, immediately begin backup withholding on reportable payments (as defined in IRC section
3406(b),
Reportable Payment, etc.), if required,
2. Complete a first annual solicitation if a TIN is not received as a result of the initial solicitation. The first annual solicitation must be completed by December 31 of the year in which the account is opened (for accounts opened before December) or by January 31 of the following year (for accounts opened the preceding December), and
3. Complete a second annual solicitation, if a TIN is not received as a result of the first annual solicitation. Solicitations must be completed after the end of the first annual solicitation period, and by December 31 of the year immediately following the calendar year in which the account was opened.
The following requirements apply to payee accounts with missing TINs for payments of designated distributions reported on Forms 1099-R:
1. Complete an initial solicitation, as previously described,
2. Complete a first annual solicitation if a TIN is not received as a result of the initial solicitation, as previously described,
3. Complete a second annual solicitation if a TIN is not received as a result of the first annual solicitation. See above for the time frame for the second annual solicitation, and
4. Withhold from the taxable portion of any payment that is a designated distribution and is subject to withholding if a response is not received as a result of the initial solicitation. The rate of withholding depends upon the type of payment made. If the payment is an eligible rollover distribution and is not paid directly to an eligible retirement plan, the appropriate withholding rate is 20%. If the payment is non-periodic (and is not an eligible rollover distribution), withhold at a rate of 10%. If the payment is periodic (and is not an eligible rollover distribution), the rate of withholding is based on the wage withholding tables, using the rate for a single individual claiming zero withholding allowances.
Pending the issuance of additional guidance, reporting entities filing Form 1095-B or Form 1095-C will not be subject to penalties for failure to report a TIN if they comply with the requirements of Treas. Reg. 301.6724-1(e) with the following modifications:
1. The initial solicitation is made at an individual's first enrollment or, if already enrolled on September 17, 2015, the next open season,
2. The second solicitation is made at a reasonable time thereafter, and
3. The third solicitation is made by December 31 of the year following the initial solicitation.
Additionally, a reporting entity is not required to solicit a TIN from an individual whose coverage is terminated.
Reminder: If a TIN is received from the payee, include it on any future information returns filed for that payee. A correction for a return with a missing TIN is not required to be filed unless correcting a money amount. However, an employer should file a Form W-2c, Corrected Wage and Tax Statement, even if the employer is only filing Form W-2c to report an employee's SSN.
Incorrect TINs
A name/TIN combination is incorrect when it does not match or cannot be found on IRS files that contain EINs, SSNs, and ITINs. In general, the requirements for payee accounts with incorrect TINs are:
1. Complete an initial solicitation when the payee opens the account. The term "account" includes accounts, relationships, and other transactions
2. Complete a first annual solicitation by December 31 of the calendar year in which a penalty notice for an incorrect name/TIN combination is received, or by January 31 of the following year if notified the preceding December. If a first "B" notice (backup withholding notice) is sent for an account in the same calendar year a Notice 972CG is received, or if a "B" notice with respect to this account has been sent for an information return filed for the same year as the penalty notice relates to, the annual solicitation requirement will have been satisfied. (See Publication 1281), and
3. Complete a second annual solicitation by December 31 of the calendar year if you receive a penalty notice for an incorrect name/TIN combination in any subsequent calendar year following the year of the first notification. If a second "B" notice has been mailed for an account in that subsequent calendar year, or if a "B" notice with respect to this account for an information return filed for the same year as the penalty notice relates to, the requirement for the second solicitation will have been satisfied. (See Publication 1281)
The following requirements apply to payee accounts with incorrect TINs for payments of designated distributions reported on Forms 1099-R. For payee accounts with incorrect TINs:
1. Complete an initial solicitation, as previously described,
2. Complete a first annual solicitation within 30 business days from the date on which the Notice 972CG is received
3. Continue to treat as valid any withholding election the payee previously made on the originally completed Form W-4P, Withholding Certificate for Pension or Annuity Payments (or a substitute form), if the payee responds to the first annual solicitation within 45 days confirming that the name/TIN combination is correct,
4. Disregard any existing withholding election based on the prior name/TIN combination if the payee responds to the first annual solicitation within 45 days and furnishes a different name/TIN combination. In order to notify the payer regarding the amount, if any, of income tax to be withheld from future designated distributions, the payee must submit a new withholding election by completing Form W-4P (or a substitute form). This new withholding election will be effective on the date provided in the sample notice in Treas. Reg. section
Pending the issuance of additional guidance, reporting entities filing Form 1095-B or Form 1095-C will not be subject to penalties for the inclusion of an incorrect TIN if they comply with the requirements of Treas. Reg. 301.6724-1(f) with the following modifications:
1. The initial solicitation is made at an individual's first enrollment or, if already enrolled on September 17, 2015, the next open season,
2. The second solicitation is made at a reasonable time thereafter, and
3. The third solicitation is made by December 31 of the year following the initial solicitation.
Additionally, a reporting entity is not required to solicit a TIN from an individual whose coverage is terminated.
Reminder: If a corrected TIN is received from the payee, include it on any future information return filed for that payee. A correction for a return with an incorrect TIN is not required unless also correcting a money amount. However, an employer should file a Form W-2c even if the employer is only filing Form W-2c to correct an employee's SSN.
In addition to the forms referenced in Part V, the following is a list of other commonly used forms for when the IRS requires an annual solicitation:
• Form W-8BEN,
Certificate of Foreign Status of Beneficial Owner for United States Tax Withholding and Reporting (Individuals),or a substitute, to solicit the TIN for a nonresident alien, foreign entity, or exempt foreign person not subject to certain U.S. information return reporting or backup withholding
• Form W-8ECI, Certificate of Foreign Person's Claim that Income is Effectively Connected With the Conduct of a Trade or Business in the United States
• Form W-8EXP, Certificate of Foreign Government or Other Foreign Organization for United States Tax Withholding and Reporting
• Form W-8IMY, Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding and Reporting
Exceptions to the Requirement for Two Annual Solicitations
In most cases, following the preceding rules will be considered acting in a responsible manner for reasonable cause for missing/incorrect TINs. However, there are exceptions to the requirement for two annual solicitations:
1. For Form 1098,
Mortgage Interest Statement,a solicitation should be made annually until receipt of the TIN of the payee of record.
2. For Form 1099-S, Proceeds from Real Estate Transactions, an initial solicitation must be completed by the due date of the related real estate closing. No additional solicitation is required.
3. For Form 1098-E, Student Loan Interest Statement, a solicitation must be made each year during which any person engaged in a trade or business that receives from any payer interest payments that aggregate $600 or more for any calendar year on one or more qualified education loans.
4. For Form 1098-T, Tuition Statement, a solicitation must be made each year during which the institution or insurer receives payments, or bills amounts, for qualified tuition and related expenses or makes reimbursements, refunds, or reductions of such amounts with respect to the individual.
5. If an account is closed in the same year in which a penalty notice is received for that account, do the required solicitation if reportable payments were paid to the account in that year, or if otherwise required to file on that account for that year.
6. If a backup withholding notice is received for an incorrect payee name and/or TIN, follow the solicitation requirements under the backup withholding rules (per IRC section 3406, Backup Withholding). DO NOT follow the general solicitation requirements explained in this publication, see IRS Publication 1281. If both backup withholding notices and penalty notices are received with respect to the same account, generally no more than two annual solicitations need to be made; see Incorrect TINs above.
Comparison of Payee Listings to Records
1. Compare the listing(s) of incorrect TINs with existing records to determine if the name/TIN combinations agree or disagree with those records.
2. If an account number is provided on the listing, identify the account(s) with the corresponding number or designation that has the same name/TIN combination. If an account number is not provided, try to identify all accounts that relate to the same incorrect name/TIN combination.
3. If the name/TIN combination on the listing agrees with the records, do the required solicitation.
4. If the name/TIN combination on the listing disagrees with the records, a solicitation is not required. Determine if:
a. An error in the name/TIN combination was made when filing the information return. If so, include the correct name/TIN combination on any future information returns filed. File a Form W-2c even if the employer is only filing Form W-2c to correct an employee's SSN.
b. The name/TIN combination was updated in the records after the information return was filed. If it was, include it on any future returns and file a Form W-2c even if only filing Form W-2c to correct an employee's SSN.
c. The information was incorrectly read during processing. If so, notate on the records and take no further action.
This section specifically applies the solicitation requirements to employers. An employer must make an initial solicitation for the employee's SSN at the time the employee begins work. The initial solicitation of the employee's SSN may be made in person, by oral request, or by written request. The SSN may also be requested through other communications, by mail, telephone, or other electronic means. The employer may rely in good faith on the number provided by the employee and use it in filling out the employee's Form W-2. Also, every employee is required to complete Form I-9, Employment Eligibility Verification, to establish that they are legally eligible to work in the U.S., and that the SSN is required to be reported on that form.
An employer has an obligation to ask for Form W-4 from a new employee. Under IRC section 3402(f)(2)(A), an employee must provide a signed Form W-4 (or a substitute form) on commencement of employment, stating the number of withholding exemptions claimed by the employee.
Since the employee is required to furnish Form W-4 to the employer on commencement of employment, Form W-4 may be used for the initial solicitation of the employee's SSN. An employer who retains the Form W-4 in his/her records will be able to document that an initial solicitation of a TIN was made, verifying that s/he acted in a responsible manner.
Employers have the responsibility to file correct information on their employee's Forms W-2. Failure to do so may result in a penalty per incorrect Form W-2. However, the penalty will not apply to any failure that an employer can show was due to reasonable cause and not willful neglect. Generally, employers must demonstrate that the failure to provide correct information was due to an event beyond their control or that there were significant mitigating factors. They must also demonstrate that they acted in a responsible manner and took steps to avoid the failure.
If an employer receives a penalty notice based on a failure to include the employee's social security number (SSN) on the Form W-2 and seeks a waiver of the penalty based on the failure of the employee to provide the SSN, special requirements apply for establishing that the employer acted in a responsible manner. The employer must show that s/he made an initial solicitation (in person, or by mail, or by telephone, or electronically) for the employee's SSN at the time the employee began work. The employer must have also made an annual solicitation for the employees SSN during the same calendar year (or by January 31 of the following year for employee's who began work during the preceding December). If the employer still does not receive an SSN, the employer must make a second annual solicitation by December 31 of the year following the calendar year in which the employee began work. The annual solicitations may be made by mail, by telephone, electronically, or in person.
If an employer receives a penalty notice based on failure to include a correct SSN (incorrect SSN) on the Form W-2 and seeks a waiver of the penalty based on the fact that the employee provided the incorrect SSN, the employer must show that it made the initial solicitation for the employee's correct SSN at the time the employee began work, and that the number used was provided by the employee. Compare the accounts on the listing with the business records. If the SSN's agree, contact the employee to explain why the number is incorrect. The employer must complete the first annual solicitation by December 31 of the calendar year in which the penalty notice for an incorrect name/TIN combination is received, or by January 31 of the following year if notified the preceding December. If the SSN does not agree, this could be the result of a recent update to SSA records, an error in the information the employer submitted, or an IRS processing error. If one of these errors occurred, the employer should correct or update the records and no further action is necessary. You do not need to respond to the employee or the IRS.
If another IRS notice is received in a subsequent year, a second annual solicitation is required. The annual solicitations must be made by December 31 of the year in which the penalty notices are received (or by January 31 of the following year if the notice is received during the preceding December). Solicitations may be made by mail, telephone, electronically, or in person. A solicitation is not required if no reportable payments will be made to the employee in that year. The SSN provided by the employee in response to a solicitation must be used by the employer on subsequent Forms W-2.
If the employer receives additional IRS notices based on the missing or incorrect SSN of the employee after having made two annual solicitations, the employer is not required to make further solicitations. The employer's initial and two annual solicitations demonstrate that s/he has acted in a responsible manner before and after the failure, and will establish reasonable cause under the regulations.
Note: For purposes of establishing reasonable cause in connection with the penalty provisions, it is the solicitation of the employee's correct SSN that is important. If the IRS notifies the employer that the SSN is incorrect, then Form W-4 may be used for any required annual solicitations of the employee's SSN.
Employers may use the SSA's SSN verification systems, known as the Social Security Number Verification Service (SSNVS) and the Employee Verification System (EVS), to verify its employee's names and SSNs, but there is no federal tax requirement (regulation) to do so. These are useful, optional ways for employers to identify potential discrepancies and correct SSNs before receiving a penalty notice. For more information, go to http://www.socialsecurity.gov/employer.
Generally, SSA and IRS records are consistent. However, it is important to note that the database used by SSA to match names and SSNs may not be identical to the IRS database. IRS penalty notices relating to mismatched TINs are based and issued exclusively on IRS system information. Mismatches reported under SSA verification systems are not considered IRS notices and do not trigger any further solicitation requirements under IRS rules for reasonable cause waivers. A mismatch determined by SSA will not necessarily result in an IRS penalty notice and annual solicitation requirements. However, if an employer receives a mismatch notice from SSA, the employer may wish to re-solicit the employee's SSN and try to obtain correct information prior to filing the Form W-2.
Questions and Answers
Q1 What are an employer's responsibilities for verifying an employee's SSN?
A1 An employer has a requirement to solicit an employee's SSN at the time the employee begins work. Since the employee is required to furnish Form W-4 to the employer on commencement of employment, Form W-4 may be used for the initial solicitation of the employee's SSN. The employer may have to make up to two (2) annual solicitations for the SSN if s/he receives a penalty notice from the IRS. The SSNVS and EVS are useful tools for employers, and may alert them to potential penalty situations.
Q2 What is most important for establishing reasonable cause in connection with Form W-2 missing/incorrect TIN penalty provisions?
A2 The solicitation of the employee's correct SSN (e.g., using the Form W-4) and the use of that number on the Form W-2 are the most important.
Q3 What should an employer do if they receive information from SSA's SSNVS or EVS system that an employee has an SSN mismatch?
A3 Responses received through the SSNVS or EVS system are not considered IRS notices and therefore do not directly enter into the determination of reasonable cause for waiving penalties. The employer is not required to solicit a new SSN from the employee, but may wish to do so.
Q4 As an employer, what do I do if I receive an IRS notice about an incorrect SSN for an employee?
A4 The employer is required under the regulations to make an annual solicitation for the correct SSN by mail, telephone, electronically, or in person.
Q5 When is an employer required to do a second annual solicitation?
A5 A second annual solicitation is required if the employer receives another IRS notice of incorrect SSN for the employee in a subsequent year.
Q6 Is there anything that employers should not do based on the receipt of an IRS notice?
A6 Employers should not use the receipt of an IRS notice as grounds for employee termination.
Q7 What can employers do to take a proactive approach to minimize receipt of bad TINs (name/TIN mismatches)?
A7 Employers should establish programs and processes for securing Forms W-4 and using the information in preparing Forms W-2. Also, they should have a process in place for re-solicitation of the required information upon receipt of a penalty notice. Employers should also remind their workers to report any name changes due to marriage, divorce, etc., to both the SSA and to the employer. To change the name shown on a social security card, the payee should complete SSA Form SS-5, Application for a Social Security Number Card. Form SS-5 is available at http://www.socialsecurity.gov (or http://www.ssa.gov) or by calling SSA at 1-800-772-1213 (TTY 1 -800-325-0778) or by visiting a local SSA office.
Q8 What records are employers required to maintain to document they made the initial and/or annual solicitations?
A8 After making a solicitation, employers should retain the response from the employees or note the response from the employees in the employer's records. Employers should note that a solicitation was made even if no response was received from the employees. Since Form W-4 may be used for the solicitation of the employee's SSN, employers who retain Forms W-4 in their records will be able to prove that a solicitation of a TIN was made, documenting that they acted in a responsible manner.
Q9 If an employer receives a corrected SSN from an employee, should the employer file Form W-2c, Corrected Wage and Tax Statement?
A9 If an employer receives a corrected SSN from an employee, the employer should file a Form W-2c with a separate form for each year needing correction. Employers file Forms W-2 with SSA. SSA matches the name and SSN on each Form W-2 against its database of all SSNs issued. When a match is found, the earnings information from the Form W-2 is recorded in the employee's lifelong earnings history. The earnings history is the basis for determining an employee's future eligibility and benefit amount for SSA's retirement, disability, and survivors programs.
VIII. Information Return Penalty Rates
Increases in Information Return Penalties
The Small Business Jobs Act (SBJA) of 2010, section 2102, increased the amounts of IRC section 6721(a) penalties from $50 to $100 for failure to timely file accurate information returns using the correct media and in the proper format. The calendar year maximum for these penalties for large businesses increased from $250,000 to $1.5 million.
The SBJA of 2010 also increased the IRC section 6722(a) penalties from $50 to $100 for failure to timely furnish accurate payee statements. IRC section 6722(b) added a penalty reduction tiered rate for corrections on or before August 1 of the filing year. IRC section 806, further increased the IRC sections 6721 and 6722 penalty rates and calendar year maximum penalties for both large and small businesses.
In addition, IRC sections 6722(f) provide for annual inflationary adjustments to the IRC sections 6721 and 6722 penalty rates and calendar year maximum penalties for returns due on or after January 1, 2016.
The IRC section 6721 penalty rates are reflected in the following tables:
IRC 6721 - Large Businesses with gross receipts of more than $5 million
----------------------------------------------------------------------
Returns due
Returns due on or after
on or after 01-01-2016
Returns due 01-01-2011 (with
Time of before and before inflationary
filing 01-01-2011 01-01-2016 adjustments)
----------------------------------------------------------------------
Not more than $15 per return/ $30 per return/ $50 per return/
30 days late $75,000 maximum $250,000 maximum $529,500 maximum
----------------------------------------------------------------------
31 days $30 per return/ $60 per return/ $100 per return/
late - August $150,000 maximum $500,000 maximum $1,589,000
1 maximum
----------------------------------------------------------------------
After August 1 $50 per return/ $100 per return/ $260 per return/
$250,000 maximum $1,500,000 $3,178,500
maximum maximum
----------------------------------------------------------------------
Intentional $100 per return $250 per return $520 per return
disregard (see note below)/ (see note below)/ (see note below)
no limitation no limitation /no limitation
----------------------------------------------------------------------
Note: Increased penalty amounts may apply in the case of certain failures in the case of intentional disregard. See IRC section
6721(e)(2).
IRC 6721 - Small Businesses with gross receipts of $5 million or less
----------------------------------------------------------------------
Returns due
Returns due on or after
on or after 01-01-2016
Returns due 01-01-2011 (with
Time of before and before inflationary
filing 01-01-2011 01-01-2016 adjustments)
----------------------------------------------------------------------
Not more than $15 per return/ $30 per return/ $50 per return/
30 days late $25,000 maximum $75,000 maximum $185,000 maximum
----------------------------------------------------------------------
31 days $30 per return/ $60 per return/ $100 per return/
late - August $50,000 maximum $200,000 maximum $529,500 maximum
1
----------------------------------------------------------------------
After August 1 $50 per return/ $100 per return/ $260 per return/
$100,000 maximum $500,000 maximum $1,059,500
maximum
----------------------------------------------------------------------
Intentional $100 per return $250 per return $520 per return
disregard (see note below)/ (see note below)/ (see note below)
no limitation no limitation /no limitation
----------------------------------------------------------------------
Note: Increased penalty amounts may apply in the case of certain failures in the case of intentional disregard. See IRC section
6721(e)(2).
The IRC section 6722 penalty rates are reflected in the following tables:
IRC 6722 - Large Businesses with gross receipts of more than $5 million
----------------------------------------------------------------------
Payee statements
required to be
furnished before Payee statements
01-01-2011 Payee statements required to be
(no tiered rate/ required to be furnished
no large furnished on or on or after
business -- small after 01-01-2011 01-01-2016 (with
Time of business and before inflationary
filing differentiation 01-01-2016 adjustments)
----------------------------------------------------------------------
Not more $50 per return/ $30 per return/ $50 per return/
than 30 $100,000 maximum $250,000 maximum $529,500 maximum
days late
----------------------------------------------------------------------
31 days $50 per return/ $60 per return/ $100 per return/
late -- $100,000 maximum $500,000 maximum $1,589,000
August 1 maximum
----------------------------------------------------------------------
After $50 per return/ $100 per return/ $260 per return/
August 1 $100,000 maximum $1,500,000 $3,178,500
maximum maximum
----------------------------------------------------------------------
Intentional $100 per return $250 per return $520 per return
disregard (see note below)/ (see note below)/ (see note below)
no limitation no limitation /no limitation
----------------------------------------------------------------------
Note: Increased penalty amounts may apply in the case of certain failures in the case of intentional disregard See IRC section
(for payee statements required to be furnished before 01-01-2011, see IRC section 6722(c)(2010)).
IRC 6722 - Small Businesses with gross receipts of $5 million or less
----------------------------------------------------------------------
Payee statements
required to be
furnished before Payee statements
01-01-2011 Payee statements required to be
(no tiered rate/ required to be furnished
no large furnished on or on or after
business -- small after 01-01-2011 01-01-2016 (with
Time of business and before inflationary
filing differentiation 01-01-2016 adjustments)
----------------------------------------------------------------------
Not more $50 per return/ $30 per return/ $50 per return/
than 30 $100,000 maximum $75,000 maximum $185,000 maximum
days late
----------------------------------------------------------------------
31 days $50 per return/ $60 per return/ $100 per return/
late -- $100,000 maximum $200,000 maximum $529,500 maximum
August 1
----------------------------------------------------------------------
After $50 per return/ $100 per return/ $260 per return/
August 1 $100,000 maximum $500,000 maximum $1,059,500
maximum
----------------------------------------------------------------------
Intentional $100 per return $250 per return $520 per return
disregard (see note below)/ (see note below)/ (see note below)
no limitation no limitation /no limitation
----------------------------------------------------------------------
Note: Increased penalty amounts may apply in the case of certain failures in the case of intentional disregard See IRC section
(for payee statements required to be furnished before 01-01-2011, see IRC section 6722(c)(2010)).
IX. THE IRS MATCHING PROCESS AND NAME CONTROLS
This section provides an overview of the IRS TIN matching process and the development of name controls on returns submitted electronically.
All information returns filed must include a correct name/TIN combination to allow for the matching of the information reported against the income included on the payee's income tax return. A verification check is performed to determine whether a name/TIN combination is correct by matching it against a file containing all SSNs issued by SSA and against a file containing all EINs and other TINs issued by IRS.
The name control (if provided) on an electronically filed information return is compared to the name control on file. If a name control is not provided or is provided incorrectly, one is developed from the name(s) provided on the first two name lines (up to 40 characters for each name line including spaces) of the information return. If a match can be made, it is considered correct. If a match is not found, the name/TIN combination is considered incorrect.
Name Controls
A name control usually consists of up to four characters. To help ensure that the name/ TIN combination for an account matches the name/ TIN combination on SSA or IRS files, use the following information when opening an account for a payee:
Individuals
A name control for an individual is generally the first four characters of the last name on the information return. For example: Ralph Teak-- Dorothy Willow --Joe McCedar
• The name control consists of four alpha and/or numeric characters.
• The hyphen (-) or a blank space are the only special characters allowed in the name control. These characters cannot be in the first position of the name control.
• The name control can have less, but no more than four characters. Blanks may be present only as the last three positions of the name control. For example: Mary Ash
If an individual has a hyphenated last name, the name control is the first four characters from the first of the two last names. Examples are Brandy
Cedar-Hawthorn--Victoria
Windsor-Maple.
For joint returns, regardless of whether the payees use the same or different last names, the name control is the first four characters of the primary payee's last name. Examples are Joseph Ash & Linda Birch-- Edward & Joan Maple
Reminder
If a payee's last name has been changed, for instance, due to marriage, advise the payee to contact SSA. SSA will issue a new social security card reflecting the payee's new name and will automatically send IRS the new name. To change the name shown on a social security card, the payee should complete SSA Form SS-5, Application for a Social Security Number Card. Form SS-5 is available at http://www.socialsecurity.gov (or http://www.ssa.gov) or by calling SSA at 1-800-772-1213 (TTY 1-800-325-0778) or by visiting a local SSA office.
Sole Proprietor
A sole proprietor must always use his/her individual name as the legal name of the business for IRS purposes. For example, Mark Hemlock is a sole proprietor who owns a business called The Sunshine Café. Because this is a sole proprietorship, the name control is the first four characters of the individual's last name -- HEML.
• The name control consists of four alpha and/or numeric characters.
• The hyphen (-) or a blank space are the only special characters allowed in the name control. These characters cannot be in the first position of the name control.
• The name control can have less, but no more than four characters. Blanks may be present only as the last three positions of the name control.
• The name control for a sole proprietor's name is the first four significant characters of the last name.
• When the taxpayer has a true name and a trade name, the name control is the first four characters of the individual's last name.
• True Name: Arthur P. Aspen
• Trade Name: Sunshine Restaurant
• Name Control: Arthur P Aspen
• When two last names are used but are not hyphenated, the name control is the first four characters of the second last name:
• Maiden Name: Jane Smith
• Married Name: Jane Smith Jones
• Name Control: Jane Smith Jones
• When an individual's two last names are hyphenated, the name control is the first four characters of the first last name.
• Name: Jane Smith-Jones
• Name Control: Jane Smith-Jones
• On joint returns with different last names, the name control is the first four characters of the last name of the individual appearing first (i.e., the primary payee's name).
• For Spanish names, when an individual has two last names, the name control is the first four characters of the first last name.
• Name: Juan Garza Morales
• Name Control: Juan Garza Morales
• Name: Maria Lopez Moreno
• Name Control: Maria Lopez Moreno
• The Spanish phrases "de", "De" "del" and "de la" are part of the name control.
• Name: Elena de la Rosa
• Name Control: Elena dela Rosa
• For last names that have only two letters:
• Name: Sunny Ming Lo
• Name Control: Sunny Ming Lo(blank)(blank)
• Vietnamese names will often have a middle name of Van (male) or Thi (female).
• Name: Kim Van Nguyen
• Name Control: Kim Van Nguyen
If the individual is newly arrived in the U.S., the last name may appear first on the name line. On the signature line, the last name will usually appear first.
* Note--Information returns do not include a signature.
Corporations
The name control for a corporation is the first four significant characters of the corporate name.
• Omit the word "The" when followed by more than one word.
• Name: The Meadowlark Company
• Name Control: Meadowlark Company
• Include the word "The" in the name control when followed by only one word.
• Name: The Flamingo
• Name Control: The Flamingo
• Corporate name control rules apply if an individual name contains the abbreviations PC (Professional Corporation), SC (Small Corporation), PA (Professional Association), PS (Professional Service), or PSC (Personal Service Corporation).
• Name: George Giraffe PSC
• Name Control: George Giraffe PSC
• When the organization name contains the words "Fund" or "Foundation", corporate name control rules apply. An example is:
Kathryn Canary Memorial Foundation.
• When an individual name and a corporate name appear, the name control is the first four characters of the corporation name.
Barbara J. Zinnia ZZ Grain, Name Control:
ZZ Grain
Partnerships
The name control for a partnership will usually result in the following order of selection:
• For businesses "doing business as" (dba) or with a trade name, use the first four characters of the dba or trade name.
•
Rosies Restaurant
• If there is no business or trade name, use the first four characters of the partnership name (even if it is an individual's name, such as in a law firm partnership).
•
Burgundy, Olive & Cobalt, Ptrs.
Online receipts of EINS generate separate rules for the name control of partnerships.
• Whether received online or via paper, if the first word is "The," disregard it unless it is followed by only one other word. An example is
The Hemlock -- THEH is the name control. The
Hemlock Grill -- HEML is the name control.
• If the EIN was assigned online (the first two digits of the EIN will be one of the following: 20, 26, 27, 45, 46, or 47), then the name control for a partnership is developed using the first four characters of the primary name line. For example, the partnership name "John Willow and James Oak Partnership" will have a name control of JOHN.
• If the first two digits of the EIN are other than 20, 26, 27, 45, 46, or 47, the name control for a partnership results from the trade or business name of the partnership. If there is no trade or business name, a name control results from the first four letters of a partnership name, in the case of a list of partners followed by the word partnership or an abbreviation thereof, or the last name of the first partner on the original Form SS-4, Application for Employer Identification Number.
A. S. Green, (The)
Oak Tree
K.L. Black & O.H. Brown
Bob Orange and Carol Black, et al. Ptrs. dba The Merry Go Round
Estates
The name control for estates is the first four characters of the last name of the decedent. The last name of the decedent must have the word "Estate" after the first four characters in the primary name line.
• Name: Howard J. Smith Dec'd
• Name Control: Howard J Smith, Estate
Trusts and Fiduciaries
The name control of a trust results in the following:
• Name controls for individual trusts are created from the first four characters of the individual's last name.
Name: Michael T. Azalea Revocable Trust
Name Control: Michael T Azalea Rvoc Tr
• For corporations set up as trusts, use the first four characters of the corporate name.
Name: Sunflower Company Employee Benefit Trust
Name Control: Sunflower Company Employee Benefit Trust
• There are separate rules for the name control of trusts, depending on whether the EIN is an on-line assignment.
• If the EIN is assigned online (the EIN will begin with one of the following two digits: 20, 26, 27, 45, 46, or 47), then the name control is developed using the first four characters of the first name on the primary name line. Ignore leading phrases such as "Trust for" or "Irrevocable Trust". An example is
Jonathan Periwinkle Memory Church Irrevocable Trust. In this case, JONA is the name control. Another example: Trust for the benefit of
Bob Jones. In this case, BOBJ is the name control.
• If the first two digits of the EIN are other than 20, 26, 27, 45, 46, or 47, then the name control for a trust or fiduciary account results from the name of the person in whose name the trust or fiduciary account is established. An example is Jonathan Periwinkle Memory Church Irrevocable Trust. PERI is the name control. In the second example above: Trust for the benefit of Bob Jones, the name control is JONE.
• The only organization, which you will always abbreviate, is Parent Teachers Association (PTA). The name control will be "PTA" plus the first letter of the name of the state in which the PTA is located.
• Name: Parent Teachers Assn Congress of Georgia
• Name Control: PTAG
• If the return has an abbreviated first name other than "PTA", the name control is the first four characters of the abbreviated name.
• The name control for a local or post number is the first four characters of the national title.
• Local 210, International--Name Control:
INTE• Post 3120, Veterans of Space Wars--Name Control: VETE
• Use the name control of the national organization name if there is a Group Exemption Number (GEN).
• For churches and their subordinates (for example nursing homes, hospitals), the name control consists of the first four characters of the legal name of the church (or subordinate), for example: Church of All
• If the organization's name indicates a political organization, use the individual's name as the name control.
• Committee to Elect Patrick Doe: Name control
PATRICK DOE
• Committee to Elect Pat Doe: Name control PATD OE
• The words
Kabushiki Kaishaor
Gaishaare the Japanese translation of the words "stock company" or "corporation." Therefore, if these words appear in a name line, these words move to the end of the name where the word "corporation" would normally appear.
For example, if
Form 8288, U.S. Withholding Tax Return for Disposition by Foreign Persons of U.S. Real Property Interests, shows the name as "Kabushiki Kaisha Green Door," the IRS will format the name as "
Green Door Kabushiki Kaisha."
Questions about Notice 972CG or the TIN listing may be directed to:
The Technical Services Operation Centralized Call Site at 1-866-455-7438 or from outside the U.S. at 304-263-8700.
To determine an incorrect Name/TIN combination, call the IRS at 1-800-829-3676 to order Publication 1635, Understanding Your EIN; Form W-9, Request for Taxpayer Identification Number and Certification; or Publication 15 (Circular E), Employer's Tax Guide.
The above referenced forms, publications, and additional information are available on the IRS website at http://www.irs.gov.
XI. FORM 10301, CD/DVD ENCRYPTION CODE AUTHORIZATION FOR CP2100/972CG NOTICES
Form 10301 is used by filers of information returns to self-assign a Personal Identification Number (PIN) that will be used in conjunction with an encryption code (obtained by calling 1-866-455-7438) to access the information contained on the CD/DVDs. The form should be mailed to:
Internal Revenue Service Information Reporting Program 230 Murall Drive Mail Stop 4360 Kearneysville, WV 25430
It may also be submitted via fax to: 1-877-477-0572 or from outside the U.S. 304-579-4105.
Note: It will take the IRS five business days to process the forms upon receipt.
[The following graphic has not been reproduced:
2012 Form 10301, CD/DVD Encryption Code Authorization]
XII. INSTRUCTIONS FOR READING CD/DVDs
Information about the CD/DVD
Payers who filed in excess of 250 Incorrect TIN payee "B" records will have data delivered on a CD (for data files of 750Mb or less). Greater than 750Mb will be provided on a DVD. The correct reader type is required to access the media (CD or DVD) type.
The files described below are on each CD/DVD:
• I40642_Annnnn ** is the Payer A-Record file. 114 Characters.
• I40642_Bnnnnn ** is all the Incorrect Payee B-Records. 222 Characters each.
• I40642_Cnnnnn ** is the Payer C-Record file. 37 Characters.
• A Copy of Publication 1586, Reasonable Cause Regulations and Requirements for Missing and Incorrect Name/TINs (including instructions for reading CD/DVDs)
• Instructions for opening a CD/DVD
• Form 10301 CD/DVD Encryption Code Authorization for CP 2100/972CG Notices
** nnnnn is the CD/DVD transmittal number.
The files are .txt files. Reading them with Notepad, word processing software, etc. will reflect the Pipe Codes "|" as separate characters between each field. Opening them in Excel software will allow reading them as a delimited file setting the delimiters as pipes "|". The files will be laid out without the Pipe Codes "|", exactly as laid out in prior year cartridges.
Note: If using certain software, be careful to set or convert fields to text so that leading zeros are not truncated or blanked out.
The enclosed CD/DVD is encrypted for security purposes and an encryption code is needed to unlock it. The table below provides instructions on how to receive an encryption code and how to extract the files.
----------------------------------------------------------------------
Step Action
----------------------------------------------------------------------
Gather the company name, the TIN, a primary or secondary
contact, and your self-assigned PIN number. A Form 10301,
CD/DVD Encryption Code Authorization for CP2100/972CG Notices,
should have been previously completed and submitted to the IRS.
This form notifies the IRS of the self-selected PIN that will
be used.
----------------------------------------------------------------------
1 Insert the CD/DVD in the appropriate drive on your computer.
----------------------------------------------------------------------
2 Call the IRS at 1-866-455-7438 or 304-263-8700 to receive a
random- generated encryption code.
a) If the "Auto-Run" feature is turned on, the system will
bring up a pop-up window with the message: "Please contact the
IRS at 1-866 455-7438 or 304-263-8700 to receive an encryption
code."
b) If "Auto-Run" is not turned on, the pop-up window will not
appear, but the IRS must still be contacted at 1-866-455-7438 or
304-263-8700 to receive an encryption code.
----------------------------------------------------------------------
3 Input the random-generated encryption code by double-clicking on
the .exe file on the CD/DVD. (The CD/DVD contains only one file
on the initial start up.)
----------------------------------------------------------------------
4 Put in the random generated encryption code and click "OK". The
next screen will provide instructions for browsing the folder
tree and selecting where to extract the files.
----------------------------------------------------------------------
5 Click on "OK" to begin the process of extracting and importing
the files.
----------------------------------------------------------------------
The information can be imported into an existing database or into other types of databases. The information can also be accessed via an Excel spreadsheet or a similar type of software. However, we have included instructions for importing the information into a Microsoft Office Access database because Access is capable of supporting a large file while some of the other software programs have column or row limitations.
Note: The Internal Revenue Service does not endorse or recommend the use of any particular software.
----------------------------------------------------------------------
Importing the CD/DVD to Access Information
----------------------------------------------------------------------
Step Action
----------------------------------------------------------------------
1 Open a new Microsoft Office Access database from your start
menu or open an existing Microsoft Access database.
----------------------------------------------------------------------
2 Select "Create a new file"
----------------------------------------------------------------------
3 In "New File", select "Blank database". Choose where to save
DVD information (i.e. "Documents"/ "Desktop" folder). Note: It
is important to remember where this information is saved as
this will be the folder used to import the files later in the
application.
----------------------------------------------------------------------
4 Select "Create". A dialog box with "(File name) Database"
appears.
----------------------------------------------------------------------
5 Go to "File" on the "Toolbar" and select "Get External Data"
and "Import".
----------------------------------------------------------------------
6 In "Import", browse drop down screen to location of text file.
Select file. Under "Files of Type", browse drop down screen and
select "Text File".
----------------------------------------------------------------------
7 Select the text file to import.
----------------------------------------------------------------------
8 Click "Import", which opens "Import Text Wizard".
----------------------------------------------------------------------
9 In "Import Text Wizard", select "Delimited", then select
"Next".
----------------------------------------------------------------------
10 Select "Other" and insert a "Pipe" ("Shift and Backslash" keys-
usually above "Enter" on the keyboard) in the box next to
"Other". Text qualifier should be "{none}". Select "Next".
----------------------------------------------------------------------
11 Select "In a New Table". Select "Next".
----------------------------------------------------------------------
12 Selecting one column at a time, highlight the field in the
"Import Text Wizard" table (shown below as Field1, Field2,
through Field15 (the "Field Name" box will change to match the
name of the Field column that is being highlighted) and ensure
"Text" is selected as the "Data Type" for each Field. If not,
change the "Data Type" field (using the drop down screen) to
"Text". This must be done in all 15 columns. Ensure that all 15
fields' "Data Type" is "Text". Accept all other defaults.
(Note: At this time, you can name/ customize each field with
the type of data that will be populated in it). Select "Next".
[graphic omitted]
Select "No Primary Key" (imports the data exactly). If "Add
primary key" is selected, it will add a field in the first
column and will number the rows. Select "Next".
"Import to Table" should have the name of the file. Select
"Finish".
An "Import Text Wizard" box appears that says "Finished
importing file......." Click on "Ok". Double click on Table
Name.
Table should appear.
Note:
To "Auto Format" each field, double click on the line in
between the boxes.
----------------------------------------------------------------------
RECORD LAYOUTS - CD/DVD
PAYER "A" RECORD-CD/DVD
----------------------------------------------------------------------
POSITION FIELD TITLE LENGTH DESCRIPTION AND REMARKS
----------------------------------------------------------------------
1 RECORD TYPE 1 AN "A" WILL BE ENTERED
----------------------------------------------------------------------
2 Pipe Code 1 "|"
----------------------------------------------------------------------
3-17 ACCESS KEY 15 NUMBER USED BY THE IRS TO GROUP A
PAYER'S INFORMATION RETURN
TRANSMITTAL
----------------------------------------------------------------------
18 Pipe Code 1 "|"
----------------------------------------------------------------------
19-20 SERVICE CAMPUS 2 TWO DIGIT SERVICE CAMPUS CODE
BROOKHAVEN = 19
CINCINNATI = 17
MEMPHIS = 49
OGDEN = 29
PHILADELPHIA = 28
----------------------------------------------------------------------
21 Pipe Code 1 "|"
----------------------------------------------------------------------
22-30 PAYER'S TIN 9 THE NINE-DIGIT NUMBER ASSIGNED BY
THE IRS
----------------------------------------------------------------------
31 Pipe Code 1 "|"
----------------------------------------------------------------------
32-71 PAYER'S NAME 40 SELF-EXPLANATORY
----------------------------------------------------------------------
72 Pipe Code 1 "|"
----------------------------------------------------------------------
73-80 NUMBER OF 8 THE NUMBER OF INFORMATION RETURNS
DOCUMENTS WITH MISSING AND INCORRECT TINS
ASSOCIATED WITH THIS PAYER. IT
WILL BE RIGHT JUSTIFIED AND ZERO
FILLED
----------------------------------------------------------------------
81 Pipe Code 1 "|"
----------------------------------------------------------------------
82-89 BWH TIN STATUS 8 THE NUMBER OF DOCUMENTS SENT TO
1 CNT THE PAYER WITH A
BWH-TIN-STATUS-IND EQUAL TO "1"
(SEE PAYER "B" RECORD). IT WILL
BE RIGHT JUSTIFIED AND ZERO
FILLED
----------------------------------------------------------------------
90 Pipe Code 1 "|"
----------------------------------------------------------------------
91-98 BWH TIN STATUS 8 THE NUMBER OF DOCUMENTS SENT TO
2 CNT THE PAYER WITH A
BWH-TIN-STATUS-IND EQUAL TO "2"
(SEE PAYER "B" RECORD) IT WILL BE
RIGHT JUSTIFIED AND ZERO FILLED.
----------------------------------------------------------------------
99 Pipe Code 1 "|"
----------------------------------------------------------------------
100-107 BWH TIN STATUS 8 THE NUMBER OF DOCUMENTS SENT TO
3 CNT THE PAYER WITH A
BWH-TIN-STATUS-IND EQUAL TO "3"
(SEE PAYER "B" RECORD) IT WILL BE
RIGHT JUSTIFIED AND ZERO FILLED.
----------------------------------------------------------------------
108 Pipe Code 1 "|"
----------------------------------------------------------------------
109 FILLER 1 BLANK FILLED
----------------------------------------------------------------------
110 Pipe Code 1 "|"
----------------------------------------------------------------------
111-114 TAX YEAR 4 TAX YEAR DOCUMENTS WERE SUBMITTED
----------------------------------------------------------------------
PAYEE "B" RECORD--CD/DVD
----------------------------------------------------------------------
POSITION FIELD TITLE LENGTH DESCRIPTION AND REMARKS
----------------------------------------------------------------------
1 RECORD TYPE 1 A "B" WILL BE ENTERED
----------------------------------------------------------------------
2 Pipe Code 1 "|"
----------------------------------------------------------------------
3-11 TIN 9 THE PAYEE'S TIN
----------------------------------------------------------------------
12 Pipe Code 1 "|"
----------------------------------------------------------------------
13 BWH TIN STATUS 1 "1" MISSING TIN
"2" NOT CURRENTLY ISSUED
"3" INCORRECT NAME/TIN
----------------------------------------------------------------------
14 Pipe Code 1 "|"
----------------------------------------------------------------------
15-19 TCC 5 TRANSMITTER CONTROL CODE
----------------------------------------------------------------------
20 Pipe Code 1 "|"
----------------------------------------------------------------------
21-22 DOC TYPE 2 "02" = Form 1042-S
"10" = Form 1099-K
"25" = Form 3921
"26" = Form 3922
"27" = Form 5498SA
"28" = Form 5498
"31" = Form 1099-Q
"32" = Form W2-G
"71" = Form 1099-H
"72" = Form 5498-ESA
"75" = Form 1099-S
"79" = Form 1099-B
"80" = Form 1099-A
"81" = Form 1098
"83" = Form 1098-T
"84" = Form 1098-E
"85" = Form 1099-C
"86" = Form 1099-G
"91" = Form 1099-DIV
"92" = Form 1099-INT
"93" = Form 1099-LTC
"94" = Form 1099-SA
"95" = Form 1099-MISC
"96" = Form 1099-OID
"97" = Form 1099- PATR
"98" = Form 1099-R
----------------------------------------------------------------------
23 Pipe Code 1 "|"
----------------------------------------------------------------------
24-43 ACCT NUMB 20 PAYEE'S ACCOUNT NUMBER FROM PAYER
----------------------------------------------------------------------
44 Pipe Code 1 "|"
----------------------------------------------------------------------
45-84 NAME LINE 40 PAYEE'S NAME LINE 1
----------------------------------------------------------------------
85 Pipe Code 1 "|"
----------------------------------------------------------------------
86-125 NAME LINE 40 PAYEE'S NAME LINE 2
----------------------------------------------------------------------
126 Pipe Code 1 "|"
----------------------------------------------------------------------
127-166 STR. ADDRESS 40 PAYEE'S STREET ADDRESS
----------------------------------------------------------------------
167 Pipe Code 1 "|"
----------------------------------------------------------------------
168-197 CITY 30 PAYEE'S CITY
----------------------------------------------------------------------
198 Pipe Code 1 "|"
----------------------------------------------------------------------
199-200 STATE CODE 2 PAYEE'S STATE CODE
----------------------------------------------------------------------
201 Pipe Code 1 "|"
----------------------------------------------------------------------
202-206 ZIP CODE 5 PAYEE'S STATE CODE
----------------------------------------------------------------------
207 Pipe Code 1 "|"
----------------------------------------------------------------------
208 TIN INDICATOR 1 "1" = Payer indicated EIN
"2" = Payer indicated SSN
"0" = no TIN indicated
----------------------------------------------------------------------
209 Pipe Code 1 "|"
----------------------------------------------------------------------
210-213 FILLER 4 BLANK FILLED
----------------------------------------------------------------------
214 Pipe Code 1 "|"
----------------------------------------------------------------------
215-222 SEQUENCE 8 NUMBER OF THE RECORD AS IT
APPEARED IN THE FILE
----------------------------------------------------------------------
PAYER "C" RECORD--CD/DVD
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POSITION FIELD TITLE LENGTH DESCRIPTION AND REMARKS
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1 RECORD TYPE 1 A "C" WILL BE ENTERED
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2 Pipe Code 1 "|"
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3-10 NUMBER OF 8 THE NUMBER OF INFORMATION
DOCUMENTS RETURNS WITH MISSING AND
INCORRECT TINS ASSOCIATED WITH
THIS PAYER. IT WILL BE RIGHT
JUSTIFIED AND ZERO FILLED
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11 Pipe Code 1 "|"
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12-19 BWH TIN STATUS 1 8 THE NUMBER OF DOCUMENTS SENT TO
CNT THE PAYER WITH A
BWH-TIN-STATUS-IND EQUAL TO "1"
(SEE PAYER "B" RECORD). IT WILL
BE RIGHT JUSTIFIED AND ZERO
FILLED
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20 Pipe Code 1 "|"
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21-28 BWH TIN STATUS 2 8 THE NUMBER OF DOCUMENTS SENT TO
CNT THE PAYER WITH A
BWH-TIN-STATUS-IND EQUAL TO "2"
(SEE PAYER "B" RECORD) IT WILL
BE RIGHT JUSTIFIED AND ZERO
FILLED
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29 Pipe Code 1 "|"
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30-37 BWH TIN STATUS 3 8 THE NUMBER OF DOCUMENTS SENT TO
CNT THE PAYER WITH A
BWH-TIN-STATUS-IND EQUAL TO "3"
(SEE PAYER "B" RECORD) IT WILL
BE RIGHT JUSTIFIED AND ZERO
FILLED.
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- Institutional AuthorsInternal Revenue Service
- Jurisdictions
- LanguageEnglish
