Payors can face numerous penalties for non?compliance as the IRS builds a case of assessments one at a time for each 1099 with errors.
Keep in mind that the IRS can consider an error can be what was filed in good faith but the Service states that the TIN doesn’t match with what the U.S. government has on file for the named payee. In addition, there is a penalty for each Form 1099 that should have been filed with the IRS but did not do so in addition to every Form 1099 filed without a Taxpayer Identification Number. In addition, there are penalties if the payor failed to send a reporting statement to the payee or did so but had an error. This video reviews how penalties can rapidly double if IRS examiners determine there is willful disregard of tax reporting requirements.
IRS CIRCULAR 230
Any tax advice included in this written or electronic communication was not intended or written to be used, and it cannot be used by the taxpayer, for the purpose of avoiding any penalties that may be imposed on the taxpayer by any governmental taxing authority or agency.
More Program Information
