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CCA 202547016 Chief Counsel Advice High relevance
Released November 21, 2025 · Issued July 7, 2025
IRC 1441, IRC 3402, IRC 6041
Nonresident withholding: IRC 1441Form 1042-S and withholding agentsWho must file: IRC 6041
- Issue
- Must a sports book withhold on and report winnings paid to a nonresident alien when the wager did not meet the Form W-2G thresholds?
- Conclusion
- Yes. Gambling winnings paid to a foreign person are subject to 30 percent withholding under section 1441 and are reported on Forms 1042 and 1042-S, regardless of the domestic W-2G and section 3402(q) thresholds.
“the winnings were subject to 30% withholding pursuant to I.R.C. § 1441(a) and were reportable on Form 1042” (IRS text)
Dollar amounts and rates are as stated in this 2025 document; see the current figures before relying on one.
IRS PDF: CCA 202547016 ↗
CCA 202534003 Chief Counsel Advice
Released August 22, 2025 · Issued April 3, 2025
IRC 6721, IRC 6722, IRC 6651
Penalties: IRC 6721 and 6722
- Issue
- What presumptions of mailing or delivery can the IRS rely on when a filer disputes receipt of IRS correspondence in a sections 6651 and 6721/6722 penalty case involving FATCA documentation?
- Conclusion
- The presumption of official regularity applies only where the IRS followed established mailing procedures; otherwise the IRS may rely on the common law mailbox rule by proving proper and timely mailing.
IRS PDF: CCA 202534003 ↗
PLR 202527006 Private letter ruling
Released July 3, 2025 · Issued April 8, 2025
IRC 1441, IRC 1442, IRC 1461, IRC 468B
Nonresident withholding: IRC 1441Form 1042-S and withholding agents
- Issue
- Must a receivership that is a qualified settlement fund withhold under sections 1441 and 1442 and file Forms 1042 and 1042-S on distributions to claimants who certify they are foreign?
- Conclusion
- The ruling addresses whether the distributions are fixed or determinable annual or periodical income subject to withholding and the related Form 1042 and 1042-S reporting duties of the fund as withholding agent.
IRS PDF: PLR 202527006 ↗
PLR 202509005 Private letter ruling High relevance
Released February 28, 2025 · Issued December 2, 2024
IRC 6041
Who must file: IRC 6041
- Issue
- Must a life insurance agency report commission rebates paid to customers under rebate agreements?
- Conclusion
- No. The rebates are purchase price adjustments to the cost of insurance and are not gross income, so there is nothing to report under section 6041.
“there is no gross income to be reported, and therefore Taxpayer is not required to furnish an information report” (IRS text)
IRS PDF: PLR 202509005 ↗
PMTA-2023-03 Program manager technical advice High relevance
Issued June 29, 2023 · Release date not published by the IRS
IRC 3406
Backup withholding: IRC 3406B notices and CP2100TIN solicitation and Form W-9
- Issue
- Does a payor that follows the instructions in a CP2100 or CP2100A notice avoid backup withholding liability for reportable payments made before it complied?
- Conclusion
- No. Under section 3406(a)(1)(A) the payor must backup withhold for the whole period the TIN was not furnished, regardless of receiving or complying with a CP2100 notice.
“the payor must backup withhold during the period during which the TIN has not been furnished in the manner required” (IRS text)
IRS PDF: PMTA-2023-03 ↗
PLR 202318001 Private letter ruling
Released May 5, 2023 · Issued February 6, 2023
IRC 6041
Who must file: IRC 6041Corrections and revocations
- Issue
- Revocation of part of PLR 202016001 concerning the municipality's reporting obligation for payments to contractors.
- Conclusion
- The IRS revoked the contractor reporting portion as not in accord with its current views, prospectively only, so no corrected information returns were required for earlier payments.
“Taxpayer is not required to correct any information returns filed with respect to payments made to X prior to the date of this revocation.” (IRS text)
IRS PDF: PLR 202318001 ↗
CCA 202252008 Chief Counsel Advice High relevance
Released December 30, 2022 · Issued November 16, 2022
IRC 3406, IRC 6041
Backup withholding: IRC 3406Who must file: IRC 6041TINs and EINs: IRC 6109
- Issue
- Must a government program report interest paid to beneficiaries of a trust based program and backup withhold on payees with missing or incorrect TINs?
- Conclusion
- Yes. The interest payments are reportable under section 6041 and backup withholding applies to payees with missing or incorrect TINs; the trust involved is not a type exempt from backup withholding.
“to backup withhold under section 3406 when payees have missing or incorrect TINs” (IRS text)
IRS PDF: CCA 202252008 ↗
PMTA-2022-05 Program manager technical advice
Issued July 8, 2022 · Release date not published by the IRS
IRC 6011, IRC 6651, IRC 6652
Electronic filingPenalties: IRC 6721 and 6722
- Issue
- Do the failure to file additions under sections 6651 and 6652 apply to a filer that files Forms 1042 and other specified returns on paper when e-filing is required?
- Conclusion
- Yes. A paper filing by a filer required to e-file is treated as a failure to timely file, so the additions to tax apply.
IRS PDF: PMTA-2022-05 ↗
CCA 202134017 Chief Counsel Advice
Released August 27, 2021 · Issued July 30, 2021
IRC 1442, IRC 1461, IRC 953
Nonresident withholding: IRC 1441Form 1042-S and withholding agents
- Issue
- May examiners assert a withholding tax adjustment against a domestic taxpayer that paid purported premiums to a foreign microcaptive without withholding or filing Form 1042?
- Conclusion
- Yes. If the payments are not insurance premiums the captive is not a domestic corporation for these purposes, and the payor bears the burden of proving it has no withholding liability under section 1461; sample Form 886-A language is provided.
IRS PDF: CCA 202134017 ↗
PLR 202118003 Private letter ruling
Released May 7, 2021 · Issued November 18, 2020
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must a state liquor monopoly file Forms 8300 for cash liquor sales over $10,000?
- Conclusion
- No. The entity is represented to be an integral part of the state, and governmental units are not required to file Form 8300.
Dollar amounts and rates are as stated in this 2021 document; see the current figures before relying on one.
PLR 202118001 corrects a factual statement without changing the result.
Related: PLR 202118001
IRS PDF: PLR 202118003 ↗
PLR 202112002 Private letter ruling High relevance
Released March 26, 2021 · Issued December 22, 2020
IRC 6050W, IRC 6041
Form 1099-K: IRC 6050WWho must file: IRC 6041
- Issue
- Is a rental platform that collects rent from tenants for landlords a TPSO, and is it also responsible for section 6041 rent reporting?
- Conclusion
- The platform is a TPSO and must report rents settled through it on Form 1099-K; payments reportable under section 6050W are excepted from section 6041 reporting.
IRS PDF: PLR 202112002 ↗
PLR 202047002 Private letter ruling High relevance
Released November 20, 2020 · Issued August 21, 2020
IRC 6041
Who must file: IRC 6041
- Issue
- Must a real estate referral company report cash rebates it pays to home buyers out of its referral fee?
- Conclusion
- No. The payments are adjustments to the purchase price of the home, not gross income, so no Forms 1099-MISC are required.
IRS PDF: PLR 202047002 ↗
PMTA-2020-09 Program manager technical advice High relevance
Issued April 27, 2020 · Release date not published by the IRS
IRC 3406, IRC 3402, IRC 6020
Backup withholding: IRC 3406
- Issue
- Does section 3402(d) relief affect how the IRS prepares section 6020(b) substitute Forms 945 for unpaid backup withholding?
- Conclusion
- Because section 3406(h)(10) treats backup withholding as wage withholding, a payor may seek section 3402(d) relief on Form 4670 with payee Forms 4669 showing the payees reported the income, which reduces the collectible withholding but not penalties.
IRS PDF: PMTA-2020-09 ↗
PLR 202016001 Private letter ruling High relevance
Released April 17, 2020 · Issued January 15, 2020
IRC 6041
Who must file: IRC 6041
- Issue
- Must a municipality report septic system grants to homeowners and payments it makes directly to contractors?
- Conclusion
- The grants are income reportable under section 6041, and the municipality, performing management and oversight, must report contractor payments on Form 1099-NEC (the contractor portion was later revoked by PLR 202318001).
IRS PDF: PLR 202016001 ↗
PLR 202004009 Private letter ruling
Released January 24, 2020 · Issued July 24, 2019
IRC 6045
Who must file: IRC 6041
- Issue
- Must a broker report on Form 1099-B when forward contract customers take delivery of property, receive substituted property, or receive cash?
- Conclusion
- No reporting is required when the customer takes delivery of the property or substituted property, but cash settlement is a sale reportable on Form 1099-B.
Modified and superseded by PLR 202118005 with wording changes only.
Related: PLR 202118005
IRS PDF: PLR 202004009 ↗
PMTA-2019-10 Program manager technical advice High relevance
Issued May 24, 2019 · Release date not published by the IRS
IRC 6109, IRC 6011, IRC 3406
TINs and EINs: IRC 6109Backup withholding: IRC 3406
- Issue
- May the IRS require that the same EIN be used on Form 945 and the related Forms 1099 and W-2G reporting backup withholding?
- Conclusion
- Yes. Sections 6011 and 6109 and their regulations give the IRS authority to require a consistent EIN on Form 945 and the related information returns.
“the Service already has the statutory authority to require taxpayers to use the same EIN on Form 945 and related information returns” (IRS text)
IRS PDF: PMTA-2019-10 ↗
PLR 201907006 Private letter ruling
Released February 15, 2019 · Issued November 8, 2018
IRC 6050W
Form 1099-K: IRC 6050WDe minimis thresholds
- Issue
- Is a software provider that settles payments through two platforms a TPSO, and how is a transaction defined for the de minimis threshold?
- Conclusion
- The provider is a TPSO for both platforms and must file Forms 1099-K for customers above the thresholds, reporting gross amounts.
IRS PDF: PLR 201907006 ↗
PLR 201836008 Private letter ruling
Released September 7, 2018 · Issued June 7, 2018
IRC 6050W
Form 1099-K: IRC 6050WDe minimis thresholds
- Issue
- Is a mobile services platform a TPSO, and how are 'transactions' counted for the 200 transaction threshold when several recipients pay for one service?
- Conclusion
- The platform is a TPSO and must report gross amounts above the thresholds; Counsel addresses how a single service paid by multiple recipients is counted for the de minimis test.
IRS PDF: PLR 201836008 ↗
PMTA-2018-15 Program manager technical advice High relevance
Issued June 25, 2018 · Release date not published by the IRS
IRC 3402, IRC 3403, IRC 6205, IRC 6051
Corrections and revocationsWorker classification and section 530
- Issue
- Can an employment tax exam gross up a wage adjustment for the employee's FICA and income tax withholding, and what Forms W-2c are required?
- Conclusion
- No gross up for the prior year; the employer must file and furnish Forms W-2c for the audit year, and employer paid employee FICA not collected from the employee is additional wages in the year paid.
IRS PDF: PMTA-2018-15 ↗
PLR 201815005 Private letter ruling
Released April 13, 2018 · Issued January 11, 2018
IRC 6041
Who must file: IRC 6041
- Issue
- Must a state created entity report home strengthening grants paid to homeowners regardless of income?
- Conclusion
- Yes. The grants are not need based general welfare payments or qualified disaster relief, so they are gross income reportable under section 6041(a) and (d).
Related: PLR 201816004
IRS PDF: PLR 201815005 ↗
PMTA-2018-11 Program manager technical advice
Issued April 12, 2018 · Release date not published by the IRS
IRC 6050I
Form 8300: IRC 6050ICorrections and revocations
- Issue
- May the IRS ask a non filer to submit one Form 8300 summarizing multiple cash receipts from a single customer in a prior year?
- Conclusion
- Yes, there is no legal prohibition; Counsel recommends the business note in the comments section that the form reflects total receipts for the customer and period.
IRS PDF: PMTA-2018-11 ↗
PLR 201810004 Private letter ruling
Released March 9, 2018 · Issued December 8, 2017
IRC 6041
Who must file: IRC 6041
- Issue
- Must facility owners report payments and costs incurred to give neighboring property owners a replacement water supply under a state mandate?
- Conclusion
- No. The amounts compensate for property damage and are not fixed or determinable income, so no section 6041 reporting is required.
IRS PDF: PLR 201810004 ↗
PMTA-2018-09 Program manager technical advice
Issued November 13, 2017 · Release date not published by the IRS
IRC 3401, IRC 7436, IRC 864
Worker classification and section 530Nonresident withholding: IRC 1441
- Issue
- Must the IRS issue a section 7436 notice when a foreign corporation argues only that wages are exempt from withholding under section 3401(a)(6)?
- Conclusion
- No. A dispute limited to the section 3401(a)(6) exclusion does not involve worker classification or section 530, so no Letter 3523 is required.
IRS PDF: PMTA-2018-09 ↗
PLR 201719009 Private letter ruling High relevance
Released May 12, 2017 · Issued February 15, 2016
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Is a platform that collects buyer payments and remits consolidated payments to sellers a TPSO, and what amount is reported?
- Conclusion
- Yes, it is a TPSO; each seller is a participating payee and the platform must report on Form 1099-K the gross amount paid including fees it deducted, once the thresholds are exceeded.
“Taxpayer must report on Form 1099-K the gross amount of all payments from Taxpayer to a Seller, including fees deducted by Taxpayer” (IRS text)
IRS PDF: PLR 201719009 ↗
PMTA-2017-03 Program manager technical advice
Issued January 4, 2017 · Release date not published by the IRS
IRC 6721, IRC 6722, IRC 6724, IRC 6652, IRC 6047
Penalties: IRC 6721 and 6722
- Issue
- Is Form 1098-Q subject to sections 6721 and 6722 penalties?
- Conclusion
- No. Form 1098-Q is not an information return or payee statement as defined in section 6724(d); failure to file it with the IRS is subject to the section 6652(e) addition, and failure to furnish it carries no penalty.
IRS PDF: PMTA-2017-03 ↗
CCA 201633033 Chief Counsel Advice
Released August 12, 2016 · Issued March 2, 2016
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Does a pawnbroker's receipt of an option fee under a contract for purchase constitute a retail sale for Form 8300 purposes?
- Conclusion
- Counsel refines earlier advice based on the statutory definition of an option and contract for purchase, concluding on when the option fee is treated as payment for a retail sale.
IRS PDF: CCA 201633033 ↗
CCA 201629008 Chief Counsel Advice High relevance
Released July 15, 2016 · Issued May 23, 2016
IRC 6721, IRC 6722, IRC 6051
Penalties: IRC 6721 and 6722Corrections and revocations
- Issue
- Can the IRS assert sections 6721 and 6722 penalties when an employer does not file Forms W-2c at the end of an employment tax audit?
- Conclusion
- Not immediately: the employer has until January 31 of the year after the audit closes to file and furnish Forms W-2c, and penalties apply only if that due date is missed.
“the IRS cannot assert the 6721/6722 penalties against the employer for failure to file and furnish Forms W-2c at the conclusion of an audit” (IRS text)
IRS PDF: CCA 201629008 ↗
PLR 201623003 Private letter ruling
Released June 3, 2016 · Issued March 1, 2016
IRC 6041, IRC 6051, IRC 131
Who must file: IRC 6041
- Issue
- Must a state report payments to in home care providers who live with the care recipient as wages on Form W-2 or under section 6041?
- Conclusion
- Payments that qualify as difficulty of care payments under section 131 and Notice 2014-7 are excludable, so the state need not report them as wages subject to income tax under sections 6041 or 6051.
Later rulings to other state Medicaid agencies reach the same conclusion and note the Form W-2 box 12 code II reporting of excludable amounts.
Related: PLR 201624012, PLR 202536026, PLR 202610003
IRS PDF: PLR 201623003 ↗
PLR 201622011 Private letter ruling
Released May 27, 2016 · Issued February 29, 2016
IRC 6050W, IRC 6041
Form 1099-K: IRC 6050WWho must file: IRC 6041
- Issue
- Must a refund disbursement service provider report tax preparation fees routed from clients' refunds to tax preparers under section 6050W or 6041?
- Conclusion
- No. It is not a TPSO, aggregated payee or electronic payment facilitator, and it does not perform management or oversight of the payments on clients' behalf, so neither section 6050W nor 6041 reporting applies.
IRS PDF: PLR 201622011 ↗
PLR 201619006 Private letter ruling
Released May 6, 2016 · Issued February 4, 2016
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Modification of PLR 201604003 to correct statements in the analysis.
- Conclusion
- The ruling that the marketplace is a TPSO with Form 1099-K obligations is unchanged; one paragraph of the analysis was deleted.
IRS PDF: PLR 201619006 ↗
CCA 201615012 Chief Counsel Advice High relevance
Released April 8, 2016 · Issued February 23, 2016
IRC 6723, IRC 6721, IRC 6722, IRC 6724, IRC 1441
Form 1042-S and withholding agentsPenalties: IRC 6721 and 6722TINs and EINs: IRC 6109Reasonable cause: IRC 6724
- Issue
- Can the IRS penalize a withholding agent for invalid payee TINs found on Forms 1042-S, and which penalty section applies?
- Conclusion
- Penalties should not be asserted automatically; they generally apply only if the withholding agent knew or should have known the TIN on the Form W-8BEN was incorrect, and in appropriate cases section 6721 (not 6723) is the penalty for an incorrect TIN on a filed Form 1042-S.
“normally should not be asserted unless the withholding agent knew or should have known that the TINs” (IRS text)
IRS PDF: CCA 201615012 ↗
INFO 2016-0026 Information letter High relevance
Released March 25, 2016 · Issued February 11, 2016
IRC 6041, IRC 6051
Who must file: IRC 6041Worker classification and section 530
- Issue
- Are California waiting time penalties paid to departing employees reported on Form W-2 or Form 1099-MISC?
- Conclusion
- Form 1099-MISC. The penalties are not wages for services, so they are not reported on Form W-2.
“the correct form for reporting the penalty is Form 1099-MISC” (IRS text)
IRS PDF: INFO 2016-0026 ↗
PLR 201607004 Private letter ruling
Released February 12, 2016 · Issued November 9, 2015
IRC 6041, IRC 136
Who must file: IRC 6041
- Issue
- Must a state clean energy organization report residential solar subsidies it pays to homeowners?
- Conclusion
- No. The subsidies are excludable under section 136 as energy conservation subsidies, so section 6041 reporting is not required.
IRS PDF: PLR 201607004 ↗
PLR 201604003 Private letter ruling High relevance
Released January 22, 2016 · Issued August 24, 2015
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Is an online marketplace that connects providers and customers and processes payments a TPSO required to file Forms 1099-K?
- Conclusion
- Yes. The platform has established a third party payment network and must report gross payments to each provider above the section 6050W(e) thresholds; it keeps primary reporting responsibility even when payments route through a third party.
“Taxpayer has a reporting obligation under section 6050W as a TPSO” (IRS text)
IRS PDF: PLR 201604003 ↗
CCA 201603031 Chief Counsel Advice High relevance
Released January 15, 2016 · Issued December 4, 2015
IRC 6721, IRC 6724, IRC 6011
Penalties: IRC 6721 and 6722Intentional disregardElectronic filing
- Issue
- How is the intentional disregard penalty computed when a filer that intentionally disregards the section 6011(e) electronic filing requirement files on paper?
- Conclusion
- The penalty for failing to e-file applies only to returns in excess of the 250 return threshold, and the percentage of aggregate amount alternative under section 6721(e) should be computed on those excess returns; the Code, regulations and IRM are silent on the exact computation so Counsel describes a reasonable method.
“only imposed on each return filed in excess of 250” (IRS text)
IRS PDF: CCA 201603031 ↗
CCA 201549026 Chief Counsel Advice
Released December 4, 2015 · Issued September 24, 2015
IRC 6050I, IRC 6721, IRC 6722, IRC 6671
Form 8300: IRC 6050IPenalties: IRC 6721 and 6722
- Issue
- Must Publication 1 (taxpayer rights) be provided in a Form 8300 examination?
- Conclusion
- Yes. Sections 6721 and 6722 penalties for Form 8300 failures are assessable penalties treated as tax, so a Form 8300 examination involves the determination of tax.
IRS PDF: CCA 201549026 ↗
PMTA-2016-08 Program manager technical advice
Issued November 5, 2015 · Release date not published by the IRS
IRC 6109, IRC 7701
TINs and EINs: IRC 6109
- Issue
- May the IRS require a disregarded entity's EIN to be reported on its owner's return?
- Conclusion
- Yes. Forms and instructions can be modified under section 6011(a) to require the disregarded entity's EIN.
IRS PDF: PMTA-2016-08 ↗
PMTA-2016-07 Program manager technical advice
Issued November 2, 2015 · Release date not published by the IRS
IRC 6723, IRC 6722, IRC 6721
Penalties: IRC 6721 and 6722TINs and EINs: IRC 6109
- Issue
- Are penalties for an incorrect TIN on a Form 1041 Schedule K-1 subject to inflation adjustment?
- Conclusion
- No inflation adjustment applies to section 6723, the penalty for the copy filed with the IRS; section 6722, the penalty for the copy furnished to the beneficiary, is inflation adjusted.
IRS PDF: PMTA-2016-07 ↗
CCA 201540013 Chief Counsel Advice
Released October 2, 2015 · Issued April 11, 2008
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Are successive pawn loans on the same collateral related transactions for Form 8300 reporting?
- Conclusion
- Yes. Where the debt from one loan is effectively shifted to the next, the loans are related transactions and cash payments over $10,000 in a year must be reported.
Dollar amounts and rates are as stated in this 2015 document; see the current figures before relying on one.
IRS PDF: CCA 201540013 ↗
PLR 201539025 Private letter ruling High relevance
Released September 25, 2015 · Issued June 25, 2015
IRC 6050W, IRC 6041, IRC 3406
Form 1099-K: IRC 6050WWho must file: IRC 6041Backup withholding: IRC 3406
- Issue
- Is a company that purchases services from providers and resells them to its customers a third party settlement organization, and must it report the provider payments?
- Conclusion
- It is not a TPSO under section 6050W, but its payments to providers are for services, not merchandise, so they are reportable under section 6041 (Form 1099-MISC) and subject to backup withholding when a condition exists.
“Taxpayer is subject to reporting under section 6041 with respect to payments to Providers” (IRS text)
IRS PDF: PLR 201539025 ↗
PLR 201535008 Private letter ruling
Released August 28, 2015 · Issued May 27, 2015
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Is a company that arranges and pays for third party services on behalf of its customers a third party settlement organization?
- Conclusion
- No. Where one channel has only a single provider and customers have no direct relationship with providers, the company's primary function is not settling transactions between buyers and sellers, so it is not a TPSO.
IRS PDF: PLR 201535008 ↗
CCA 201533012 Chief Counsel Advice High relevance
Released August 14, 2015 · Issued May 4, 2015
IRC 6041, IRC 6045, IRC 6050J
Who must file: IRC 6041
- Issue
- Must a county clerk of court issue Forms 1099 to attorneys receiving garnished funds or client refunds, or Forms 1099-S on foreclosure sales?
- Conclusion
- No on all three: the clerk is not the payor of garnished funds, refunds of a client's money are not income, and foreclosure transfers are excepted from Form 1099-S reporting.
IRS PDF: CCA 201533012 ↗
CCA 201520011 Chief Counsel Advice
Released May 15, 2015 · Issued April 24, 2015
IRC 6109
TINs and EINs: IRC 6109
- Issue
- Is there a penalty for failing to update EIN application information as Reg. 301.6109-1(d)(2)(ii) requires?
- Conclusion
- No directly applicable penalty exists for failing to update EIN responsible party information.
“There are currently no directly-applicable penalties for failure to update this information.” (IRS text)
IRS PDF: CCA 201520011 ↗
CCA 201516065 Chief Counsel Advice
Released April 17, 2015 · Issued January 30, 2015
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must businesses in U.S. territories file Form 8300 with the IRS?
- Conclusion
- Yes. Persons in a trade or business in U.S. territories are subject to IRS jurisdiction and must file Form 8300 with the IRS in addition to any territorial filing.
IRS PDF: CCA 201516065 ↗
CCA 201503013 Chief Counsel Advice High relevance
Released January 16, 2015 · Issued December 24, 2014
IRC 6721, IRC 6722, IRC 1461
Penalties: IRC 6721 and 6722Form 1042-S and withholding agentsNonresident withholding: IRC 1441
- Issue
- Should sections 6721 and 6722 penalties be assessed against a withholding agent whose Forms 1042-S reported the amounts actually withheld?
- Conclusion
- No. Because the withholding agent correctly reported the amounts actually withheld in box 7 of Form 1042-S, there was no error on the forms and no penalty should be assessed.
“The IRS should therefore not assess penalties against the withholding agent under sections 6721 and 6722” (IRS text)
IRS PDF: CCA 201503013 ↗
CCA 201447025 Chief Counsel Advice High relevance
Released November 21, 2014 · Issued June 19, 2014
IRC 6041, IRC 3406
Who must file: IRC 6041Backup withholding: IRC 3406
- Issue
- Are payments to limited liability companies exempt from section 6041 reporting?
- Conclusion
- Only if the LLC has elected corporate classification on Form 8832; LLCs classified as partnerships or disregarded entities are not exempt recipients, so payments to them are reportable and subject to backup withholding rules.
“exempt from section 6041 reporting requirements only if the LLC has elected to be classified for federal tax purposes as a corporation” (IRS text)
IRS PDF: CCA 201447025 ↗
PLR 201444001 Private letter ruling
Released October 31, 2014 · Issued July 18, 2014
IRC 6041
Who must file: IRC 6041
- Issue
- Must a home equity protection program report a payment to homeowners who sold at a loss when it does not know their basis?
- Conclusion
- No. The payment is not fixed or determinable income because the payor cannot know how much is includible, so no information return is required.
IRS PDF: PLR 201444001 ↗
CCA 201438028 Chief Counsel Advice
Released September 19, 2014 · Issued August 22, 2014
IRC 6721
Penalties: IRC 6721 and 6722Intentional disregard
- Issue
- Is 'assessing' the correct term in an intentional disregard penalty letter, and must the IRS follow deficiency procedures?
- Conclusion
- The section 6721 penalty is an assessable penalty; the IRS need not follow deficiency procedures and the filer's remedy is to pay and sue for refund or use collection due process.
“The section 6721 penalty is assessable and the IRS does not need to follow deficiency procedures to assess it.” (IRS text)
IRS PDF: CCA 201438028 ↗
PMTA-2014-14 Program manager technical advice
Issued July 24, 2014 · Release date not published by the IRS
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Is a state department of revenue required to file Form 8300 for cash it receives?
- Conclusion
- No. A state department of revenue is a governmental unit exempt from section 6050I reporting.
IRS PDF: PMTA-2014-14 ↗
PMTA-2014-13 Program manager technical advice
Issued July 22, 2014 · Release date not published by the IRS
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Are governmental units and instrumentalities exempt from Form 8300 reporting?
- Conclusion
- Governmental units (the United States, states, political subdivisions and their integral parts) are exempt; instrumentalities of government are persons that must file Form 8300.
Related: PMTA-2014-14
IRS PDF: PMTA-2014-13 ↗
PLR 201426002 Private letter ruling
Released June 27, 2014 · Issued March 31, 2014
IRC 6041, IRC 6049, IRC 7872
Who must file: IRC 6041
- Issue
- Are bank fee credits earned on commercial deposit balances reportable under section 6041 or 6049?
- Conclusion
- Fee credits used only to offset the bank's own fees are not reportable; credits used to pay third party vendors are interest income reportable under section 6049 unless the holder is an exempt recipient.
IRS PDF: PLR 201426002 ↗
CCA 201409008 Chief Counsel Advice
Released February 28, 2014 · Issued December 31, 2013
IRC 6109, IRC 6721
TINs and EINs: IRC 6109Corrections and revocations
- Issue
- May an acquiring corporation continue to use the EIN of a disregarded entity it acquired?
- Conclusion
- No. The scenario does not fit the revenue rulings that allow EIN continuation, so the acquiring corporation should have obtained its own EIN; Counsel notes payee statements may have been incorrect but does not opine on sections 6721 to 6724.
IRS PDF: CCA 201409008 ↗
CCA 201349013 Chief Counsel Advice High relevance
Released December 6, 2013 · Issued October 24, 2013
IRC 6041, IRC 6041A
Who must file: IRC 6041
- Issue
- Must payments to an incorporated veterinarian be reported under section 6041?
- Conclusion
- Generally yes. Veterinarians provide medical and health care services, so the corporate exemption in Reg. 1.6041-3(p)(1) does not apply and payments of $600 or more are reportable.
“Incorporated veterinarians are not exempted from the reporting requirement by Treas. Reg. § 1.6041-3(p)(1)” (IRS text)
Dollar amounts and rates are as stated in this 2013 document; see the current figures before relying on one.
IRS PDF: CCA 201349013 ↗
PMTA-2013-17 Program manager technical advice
Issued August 7, 2013 · Release date not published by the IRS
IRC 530, IRC 3121, IRC 3401
Worker classification and section 530
- Issue
- Does section 530 relief apply to federal agencies?
- Conclusion
- No. Section 530 does not apply to federal agencies, and a federal agency could not satisfy the reasonable basis requirement in any event.
IRS PDF: PMTA-2013-17 ↗
PLR 201327002 Private letter ruling
Released July 5, 2013 · Issued April 8, 2013
IRC 6041, IRC 104
Who must file: IRC 6041
- Issue
- Must a guaranty style fund report benefits it pays to beneficiaries of structured settlement annuities of an insolvent insurer?
- Conclusion
- No. The benefits remain excludable under section 104(a)(2), so they are not income under section 6041 and the fund has no reporting obligation.
IRS PDF: PLR 201327002 ↗
PMTA-2013-08 Program manager technical advice
Issued June 3, 2013 · Release date not published by the IRS
IRC 6011, IRC 6081
Electronic filing
- Issue
- May the IRS require Form 8809 extension requests for more than one filer to be filed electronically through FIRE?
- Conclusion
- No regulation or revenue procedure then mandated electronic Form 8809 filing, so Counsel reviews the authority needed and how the IRS should process paper requests.
IRS PDF: PMTA-2013-08 ↗
CCA 201315017 Chief Counsel Advice High relevance
Released April 12, 2013 · Issued December 20, 2012
IRC 6721, IRC 6722
Penalties: IRC 6721 and 6722
- Issue
- Are penalties under current sections 6721 and 6722 divisible for refund suit jurisdiction, so a filer can pay the penalty on one return and sue?
- Conclusion
- Yes. Both penalties are imposed per return or per statement, so they are divisible and a filer may pay the penalty attributable to one failure and sue for refund.
“The current section 6721 and section 6722 penalties are both divisible penalties” (IRS text)
IRS PDF: CCA 201315017 ↗
PMTA-2013-04 Program manager technical advice High relevance
Issued April 4, 2013 · Release date not published by the IRS
IRC 6721, IRC 6722, IRC 6501
Penalties: IRC 6721 and 6722
- Issue
- When does the assessment period run for sections 6721 and 6722 penalties on Forms 1099 and W-2, and does filing Form 1096 or W-3 start it?
- Conclusion
- The section 6721 period is three years from filing of each information return and never starts if a return is not filed; the section 6722 period is unsettled; Forms 1096 and W-3 are transmittals, not returns, and do not start the period.
“a Form 1096 or W-3 is not sufficient to begin the section 6501 assessment period” (IRS text)
IRS PDF: PMTA-2013-04 ↗
CCA 201313028 Chief Counsel Advice High relevance
Released March 29, 2013 · Issued June 5, 2012
IRC 6045, IRC 6041, IRC 6724
Who must file: IRC 6041TIN solicitation and Form W-9Reasonable cause: IRC 6724
- Issue
- Must a state transportation department report condemnation awards on Form 1099-S rather than 1099-MISC, and what if owners refuse to give TINs?
- Conclusion
- Reporting falls under section 6045(e) on Form 1099-S for the full gross proceeds; the department must solicit TINs but faces no penalty if it solicited in good faith under the regulations.
“will not be subject to penalties if it has complied in good faith” (IRS text)
IRS PDF: CCA 201313028 ↗
PLR 201311006 Private letter ruling
Released March 15, 2013 · Issued December 11, 2012
IRC 6041, IRC 1441, IRC 104
Who must file: IRC 6041Nonresident withholding: IRC 1441
- Issue
- Must a fund distributing damages to victims of a physical injury event report under section 6041 or withhold under section 1441?
- Conclusion
- Damages other than interest are excludable under section 104(a)(2), so no section 6041 reporting and no section 1441 withholding is required on those amounts.
IRS PDF: PLR 201311006 ↗
PLR 201309005 Private letter ruling
Released March 1, 2013 · Issued November 29, 2012
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must a utility file Form 8300 for cash bill payments received at its payment centers that exceed $10,000 over a year?
- Conclusion
- The ruling applies the single transaction and related transaction rules to recurring utility bill payments from the same customer.
Dollar amounts and rates are as stated in this 2013 document; see the current figures before relying on one.
IRS PDF: PLR 201309005 ↗
PLR 201308024 Private letter ruling High relevance
Released February 22, 2013 · Issued November 19, 2012
IRC 3406, IRC 6724
Backup withholding: IRC 3406TIN solicitation and Form W-9Reasonable cause: IRC 6724
- Issue
- May a partnership that acquired brokerage accounts rely on the predecessor brokers' records and procedures to establish that Forms W-9 were obtained, rather than resoliciting?
- Conclusion
- Yes. Consistent with the due diligence safe harbor in Reg. 301.6724-1(g) for acquired accounts, the partnership may rely on the transferors' records, need not obtain new Forms W-9 unless none was obtained, and must be able to retrieve the forms for the retention period.
“required to obtain new Forms W-9 only if no Form W-9 was obtained” (IRS text)
IRS PDF: PLR 201308024 ↗
CCA 201248022 Chief Counsel Advice
Released November 30, 2012 · Issued September 28, 2012
IRC 3406, IRC 6721, IRC 6041
Backup withholding: IRC 3406B notices and CP2100Penalties: IRC 6721 and 6722
- Issue
- Companion advice on casino obligations after a Notice 972CG proposes penalties for incorrect TINs on Forms W-2G.
- Conclusion
- Same conclusions as CCA 201246028: a slot winnings payee TIN with the right number of digits does not trigger backup withholding, and Notice 972CG as written does not require the casino to issue backup withholding notices.
IRS PDF: CCA 201248022 ↗
CCA 201246028 Chief Counsel Advice High relevance
Released November 16, 2012 · Issued September 28, 2012
IRC 3406, IRC 6721, IRC 6041
Backup withholding: IRC 3406B notices and CP2100Penalties: IRC 6721 and 6722TINs and EINs: IRC 6109
- Issue
- When the IRS notifies a casino of name/TIN mismatches on Forms W-2G for slot winnings, must the casino backup withhold and send B notices?
- Conclusion
- Backup withholding applies to slot winnings only where the TIN furnished does not have the proper number of digits; a Notice 972CG penalty notice is not a backup withholding notice and does not itself trigger B notice obligations for those payments.
“Only if the payee provided the gaming establishment with a TIN that does not contain the proper number of digits” (IRS text)
IRS PDF: CCA 201246028 ↗
PLR 201240005 Private letter ruling High relevance
Released October 5, 2012 · Issued July 9, 2012
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Does a U.S. tax reporting designee of non-U.S. settlement banks have its own Form 1099-K obligation, and may it rely on the banks' foreign payee determinations?
- Conclusion
- The designee is not the payment settlement entity and has no section 6050W obligation of its own; as designee it may rely on the non-U.S. payor's determination that a merchant with no U.S. address is a foreign payee and on documentation the payor collected.
IRS PDF: PLR 201240005 ↗
CCA 201234025 Chief Counsel Advice High relevance
Released August 24, 2012 · Issued May 11, 2012
IRC 6721, IRC 6724, IRC 6041
Penalties: IRC 6721 and 6722Reasonable cause: IRC 6724TIN solicitation and Form W-9
- Issue
- Must a casino that solicited a patron's TIN under the Form W-2G procedures make an annual solicitation under Reg. 301.6724-1(f) when the TIN turns out to be incorrect?
- Conclusion
- No. The casino satisfies an exception to the annual solicitation requirement, so it can establish reasonable cause for an incorrect TIN on Form W-2G without a further solicitation.
“the gaming establishment satisfies an exception to the requirement to make an annual solicitation” (IRS text)
IRS PDF: CCA 201234025 ↗
CCA 201224033 Chief Counsel Advice
Released June 15, 2012 · Issued March 30, 2012
IRC 3406, IRC 6651
Backup withholding: IRC 3406Worker classification and section 530
- Issue
- How should the IRS protect its position where an employer either misclassified workers or alternatively failed to obtain SSNs and owes backup withholding?
- Conclusion
- Counsel advises on protective steps for asserting backup withholding as an alternative to employment tax where the employer has no worker TINs (details largely redacted).
IRS PDF: CCA 201224033 ↗
CCA 201221018 Chief Counsel Advice High relevance
Released May 25, 2012 · Issued April 30, 2012
IRC 6049
Deceased payeesTINs and EINs: IRC 6109
- Issue
- Under which name and TIN should a state unclaimed property office report interest on a decedent's unclaimed funds?
- Conclusion
- Report using the decedent's name and SSN if the interest belongs on the decedent's final return, or the estate's EIN if the interest is income of the estate, as if the funds were in a bank account.
“the Form 1099-INT should report the decedent's name and SSN” (IRS text)
IRS PDF: CCA 201221018 ↗
PLR 201219013 Private letter ruling
Released May 11, 2012 · Issued January 30, 2012
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Is a company and its subsidiaries that pay providers on customers' behalf a TPSO?
- Conclusion
- No. On the facts presented the taxpayer has not established a third party payment network and does not have a section 6050W reporting obligation.
IRS PDF: PLR 201219013 ↗
PMTA-2012-07 Program manager technical advice
Issued February 13, 2012 · Release date not published by the IRS
IRC 6103
TIN solicitation and Form W-9
- Issue
- May the IRS give state tax agencies access to the e-Services TIN Matching application?
- Conclusion
- Legally permissible for state tax administration; whether to implement is a business decision.
IRS PDF: PMTA-2012-07 ↗
PLR 201201001 Private letter ruling
Released January 6, 2012 · Issued September 30, 2011
IRC 6050W
Form 1099-K: IRC 6050W
- Issue
- Is a pharmacy benefit manager a TPSO required to file Forms 1099-K for payments to network pharmacies?
- Conclusion
- No. Based on the contractual structure between plan sponsors, the PBM and pharmacies, the PBM does not have a section 6050W reporting obligation.
IRS PDF: PLR 201201001 ↗
INFO 2011-0095 Information letter High relevance
Released December 6, 2011 · Issued November 9, 2011
IRC 3406, IRC 3121
Backup withholding: IRC 3406TIN solicitation and Form W-9TINs and EINs: IRC 6109
- Issue
- May a school district pay a C corporation vendor whose owner gave only her SSN on Form W-9, and must it backup withhold?
- Conclusion
- Corporations are generally exempt from backup withholding and a payor may treat a payee as exempt in some cases, but the Form W-9 name and TIN should match the corporate payee; the letter explains how to proceed.
IRS PDF: INFO 2011-0095 ↗
PLR 201147014 Private letter ruling
Released November 25, 2011 · Issued August 16, 2011
IRC 6041
Who must file: IRC 6041
- Issue
- Must an insurer report supplemental unemployment insurance benefits it pays to insured individuals?
- Conclusion
- Yes. The full benefit is includible in income, so benefits of $600 or more in a year must be reported on Form 1099-MISC with a payee statement.
Dollar amounts and rates are as stated in this 2011 document; see the current figures before relying on one.
IRS PDF: PLR 201147014 ↗
PLR 201139003 Private letter ruling
Released September 30, 2011 · Issued June 28, 2011
IRC 6041, IRC 6050H
Who must file: IRC 6041
- Issue
- Are mortgage interest subsidies paid on behalf of servicemember borrowers reportable, and on which form?
- Conclusion
- The subsidy is income to the borrower and treated as interest paid by the borrower; it is reportable on Form 1099 under section 6041 if thresholds are met and as interest received on Form 1098 under section 6050H.
IRS PDF: PLR 201139003 ↗
CCA 201122020 Chief Counsel Advice
Released June 3, 2011 · Issued May 5, 2011
IRC 6045, IRC 6050J, IRC 6050P
Who must file: IRC 6041
- Issue
- Must a county issue Form 1099-S, 1099-A or 1099-C to a former owner after a tax lien foreclosure sale?
- Conclusion
- No. A local government is not an applicable entity under section 6050P, is not a lender under section 6050J, and foreclosure transfers are carved out of section 6045(e) reporting.
IRS PDF: CCA 201122020 ↗
PLR 201117014 Private letter ruling
Released April 29, 2011 · Issued January 24, 2011
IRC 6041
Who must file: IRC 6041
- Issue
- Must a company report reward points that program enrollees can redeem for discounted goods from third party vendors?
- Conclusion
- No. Non transferable points with no cash value do not confer gross income, so no section 6041 reporting applies.
IRS PDF: PLR 201117014 ↗
PMTA-2011-015 Program manager technical advice
Issued April 20, 2011 · Release date not published by the IRS
IRC 530, IRC 3121, IRC 3401
Worker classification and section 530
- Issue
- Must a taxpayer show it actually and reasonably relied on a section 530 safe harbor, and when?
- Conclusion
- Yes. The taxpayer must have actually and reasonably relied on the safe harbor for the periods at issue, though reliance may have begun after the workers were first engaged.
IRS PDF: PMTA-2011-015 ↗
CCA 201114025 Chief Counsel Advice High relevance
Released April 8, 2011 · Issued February 28, 2011
IRC 6045, IRC 6721, IRC 6722, IRC 6724
Penalties: IRC 6721 and 6722Intentional disregardReasonable cause: IRC 6724
- Issue
- Was a corporation that redeemed its own stock required to file Forms 1099-B, and do intentional disregard penalties apply?
- Conclusion
- A corporation that regularly redeems its stock is a broker that must file Forms 1099-B; whether the higher intentional disregard penalty or reasonable cause relief applies depends on the filing evidence, including the missing Form 1096.
IRS PDF: CCA 201114025 ↗
CCA 201112008 Chief Counsel Advice
Released March 25, 2011 · Issued December 14, 2010
IRC 6041, IRC 6050P
Who must file: IRC 6041
- Issue
- Are trustee payments that reduce borrowers' loan principal under a state unfair lending settlement reportable to borrowers?
- Conclusion
- No. The payments equitably reform the loans and are not gross income to borrowers, so no reporting under section 6041 or 6050P.
IRS PDF: CCA 201112008 ↗
PMTA-2011-002 Program manager technical advice
Issued March 22, 2011 · Release date not published by the IRS
IRC 1441, IRC 864, IRC 7623
Nonresident withholding: IRC 1441Form 1042-S and withholding agents
- Issue
- What is the source of a whistleblower award paid to a nonresident alien, and must the IRS withhold under section 1441?
- Conclusion
- The award is treated as compensation for services, U.S. source to the extent of activities in the United States, and the IRS must withhold under section 1441 on that portion absent treaty relief.
IRS PDF: PMTA-2011-002 ↗
PMTA-2011-001 Program manager technical advice
Issued March 11, 2011 · Release date not published by the IRS
IRC 7623, IRC 3402
Who must file: IRC 6041De minimis thresholds
- Issue
- May the IRS withhold and report on whistleblower awards under section 7623(a) and adopt a de minimis threshold?
- Conclusion
- Yes. Systematic withholding and information reporting is legally defensible for both 7623(a) and (b) awards, and a consistently applied de minimis threshold is permissible.
IRS PDF: PMTA-2011-001 ↗
CCA 201106009 Chief Counsel Advice
Released February 11, 2011 · Issued April 28, 2010
IRC 6041, IRC 3121, IRC 6053
Who must file: IRC 6041
- Issue
- Are payments by clubs and establishments to taxi drivers who deliver patrons income, tips, or separate service payments, and who reports them?
- Conclusion
- The payments are income; whether they are tips reportable to the cab company or separate service payments reportable by the establishment under section 6041 depends on the facts.
IRS PDF: CCA 201106009 ↗
CCA 201106010 Chief Counsel Advice High relevance
Released February 11, 2011 · Issued December 1, 2010
IRC 6041, IRC 3121, IRC 6053
Who must file: IRC 6041
- Issue
- Follow up: on the additional facts, are payments by establishments to taxi drivers tips or separate service payments?
- Conclusion
- They are payments for services separate from the drivers' employment, so the clubs and establishments must report them under section 6041.
“The clubs and other establishments are responsible for complying with the reporting requirements under I.R.C. § 6041” (IRS text)
IRS PDF: CCA 201106010 ↗
CCA 201049027 Chief Counsel Advice
Released December 10, 2010 · Issued October 5, 2010
IRC 3406, IRC 7436
Backup withholding: IRC 3406Worker classification and section 530
- Issue
- Does the Tax Court have section 7436 jurisdiction over backup withholding, and does a worker classification notice suspend the assessment period for backup withholding?
- Conclusion
- The Tax Court lacks jurisdiction under section 7436 over backup withholding on workers found to be independent contractors, but issuance of the notice may nonetheless suspend the assessment period for backup withholding where Forms 945 were filed.
IRS PDF: CCA 201049027 ↗
CCA 201044014 Chief Counsel Advice
Released November 5, 2010 · Issued October 19, 2010
IRC 6050I
Form 8300: IRC 6050I
- Issue
- How do the related transaction and aggregation rules interact for multiple cash payments on products bought within 24 hours?
- Conclusion
- Transactions between the same payor and recipient within 24 hours are related, and cash installments on related transactions must be aggregated and reported once they exceed $10,000 within 12 months.
Dollar amounts and rates are as stated in this 2010 document; see the current figures before relying on one.
IRS PDF: CCA 201044014 ↗
CCA 201037027 Chief Counsel Advice High relevance
Released September 17, 2010 · Issued May 20, 2010
IRC 3406
Backup withholding: IRC 3406TIN solicitation and Form W-9
- Issue
- Can the IRS assert backup withholding liability for failure to obtain Form W-9 certifications when the payor no longer has the forms and the three year retention period has passed?
- Conclusion
- Yes. The retention period limits how long the payor must keep the forms, not the IRS's ability to assert liability; the payor must show it obtained the certifications when required.
“even if the three-year period for retaining those forms has passed” (IRS text)
IRS PDF: CCA 201037027 ↗
PMTA-2010-057 Program manager technical advice
Issued September 16, 2010 · Release date not published by the IRS
IRC 6103
Electronic filing
- Issue
- Can the IRS drop the Form 6847 consent for the Combined Federal/State Filing program, and should the program be treated as a section 6103(d) exchange?
- Conclusion
- Participation in the program can itself serve as consent to disclose information returns to states, and Counsel recommends against treating it as a 6103(d) exchange because that would limit state use.
IRS PDF: PMTA-2010-057 ↗
PLR 201035004 Private letter ruling
Released September 3, 2010 · Issued May 26, 2010
IRC 6041
Who must file: IRC 6041
- Issue
- Must a school department report per diem transportation reimbursements paid to parents of special needs students?
- Conclusion
- No, unless the department knows the amounts exceed the parents' actual expenses by $600 or more; reimbursements of actual expenses are not income.
Dollar amounts and rates are as stated in this 2010 document; see the current figures before relying on one.
IRS PDF: PLR 201035004 ↗
CCA 201020014 Chief Counsel Advice
Released May 21, 2010 · Issued April 16, 2010
IRC 3509, IRC 3121, IRC 530
Worker classification and section 530
- Issue
- Does section 3509 apply when an employer failed to pay FICA because it wrongly relied on an exclusion from employment rather than misclassifying workers?
- Conclusion
- No. Where employee status itself was not at issue, section 3509 and section 530 do not apply; the reporting consistency test would also fail where no Forms 1099 were filed.
IRS PDF: CCA 201020014 ↗
PLR 201017029 Private letter ruling High relevance
Released April 30, 2010 · Issued December 10, 2009
IRC 6041
Who must file: IRC 6041
- Issue
- Must a county welfare program report rent it pays directly to landlords on behalf of recipients?
- Conclusion
- Yes. Rent is gross income to landlords, the county acts in a trade or business and performs management and oversight, so it must file Forms 1099 and furnish statements to landlords.
“if the County makes a direct payment to a landlord pursuant to the Program, the County is required to file an information return” (IRS text)
IRS PDF: PLR 201017029 ↗
PMTA-2010-012 Program manager technical advice
Issued April 6, 2010 · Release date not published by the IRS
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must a business that receives and cashes a check over $10,000 file Form 8300?
- Conclusion
- No. A check is not cash and no cash was received in a reportable transaction.
Dollar amounts and rates are as stated in this 2010 document; see the current figures before relying on one.
IRS PDF: PMTA-2010-012 ↗
PMTA-2009-165 Program manager technical advice
Issued March 22, 2010 · Release date not published by the IRS
IRC 6041
Who must file: IRC 6041
- Issue
- Are ARRA funded state Energy Star appliance rebates income to consumers and reportable on Forms 1099?
- Conclusion
- The IRS will treat the rebates as not includible in income and states and other payors need not report them on Forms 1099.
“States and other payors of ARRA Energy Star rebates are not required to report such payments on Forms 1099.” (IRS text)
IRS PDF: PMTA-2009-165 ↗
PLR 201004005 Private letter ruling
Released January 29, 2010 · Issued October 21, 2009
IRC 6041
Who must file: IRC 6041
- Issue
- Must a state entity report $x home purchase grants to buyers under an economic stimulus program?
- Conclusion
- Yes. The grants are neither purchase price reductions nor need based general welfare payments, so they are gross income reportable under section 6041(a) and (d).
IRS PDF: PLR 201004005 ↗
INFO 2009-0216 Information letter
Released December 31, 2009 · Issued October 14, 2009
IRC 3406
Backup withholding: IRC 3406TINs and EINs: IRC 6109
- Issue
- Will the IRS adopt the Taxpayer Advocacy Panel recommendation to treat single member disregarded entities as separate payees for backup withholding and Form 1099 reporting?
- Conclusion
- The IRS acknowledged the recommendation and said it would be considered with other divisions and Treasury; no commitment was made.
IRS PDF: INFO 2009-0216 ↗
CCA 200949039 Chief Counsel Advice
Released December 4, 2009 · Issued August 25, 2009
IRC 3406
Backup withholding: IRC 3406B notices and CP2100
- Issue
- Does IRM 5.19.3 conflict with section 3406(c), and must the IRS always stop backup withholding within 45 days after a notified payee underreporting condition is cured?
- Conclusion
- No conflict: the Code sets the deadline by which the IRS must act to stop withholding and the IRM sets the normal date withholding stops; the 45 day rule applies only where there was no underreporting or where hardship exists.
IRS PDF: CCA 200949039 ↗
PMTA-2009-161 Program manager technical advice
Issued December 4, 2009 · Release date not published by the IRS
IRC 6109, IRC 31, IRC 3402
TINs and EINs: IRC 6109
- Issue
- May the IRS disallow withholding credits when an ITIN filer's Form W-2 carries a different SSN?
- Conclusion
- Counsel explains that tax actually withheld is creditable to the employee and supports procedures to verify and allow the credit despite the SSN and ITIN mismatch.
Same memorandum as CCA 201005001.
IRS PDF: PMTA-2009-161 ↗
CCA 200941012 Chief Counsel Advice High relevance
Released October 9, 2009 · Issued May 13, 2009
IRC 6721
Penalties: IRC 6721 and 6722Intentional disregard
- Issue
- May the IRS assert the section 6721(e) intentional disregard penalty against a company that failed to timely file information returns for a year after years of similar failures?
- Conclusion
- Yes. Intentional disregard means a knowing or willful failure; a history of late filing after being on notice of the requirement supports the higher penalty.
“it knowingly or willfully failed to timely file information returns” (IRS text)
IRS PDF: CCA 200941012 ↗
CCA 200940029 Chief Counsel Advice High relevance
Released October 2, 2009 · Issued November 21, 2008
IRC 3406
Backup withholding: IRC 3406
- Issue
- May a payor voluntarily backup withhold on a payee who has furnished a TIN?
- Conclusion
- No. There is no voluntary backup withholding; a condition under section 3406(a) must exist, so a payor holding the payee's TIN should not backup withhold.
“Generally we don't have voluntary backup withholding.” (IRS text)
IRS PDF: CCA 200940029 ↗
CCA 200938029 Chief Counsel Advice
Released September 18, 2009 · Issued November 24, 2008
IRC 3406
Backup withholding: IRC 3406
- Issue
- Should a government payor backup withhold on jury-type payments when payees fail to provide TINs?
- Conclusion
- Yes. Because the payments were determined to be income to the payees, the payor should backup withhold where a payee fails to provide a TIN.
IRS PDF: CCA 200938029 ↗
INFO 2009-0118 Information letter
Released June 27, 2009 · Issued January 12, 2009
IRC 6041
Who must file: IRC 6041
- Issue
- Must a nonprofit issue Forms 1099 to volunteer drivers for mileage reimbursements?
- Conclusion
- Not if the payor does not know how much each volunteer may exclude, because the includible amount is not fixed and determinable.
“the amount included is not fixed and determinable” (IRS text)
Related: INFO 2010-0145
IRS PDF: INFO 2009-0118 ↗
CCA 200925042 Chief Counsel Advice
Released June 19, 2009 · Issued January 5, 2009
IRC 6109
TINs and EINs: IRC 6109Deceased payees
- Issue
- May the IRS issue ITINs for deceased individuals who need one for a legitimate tax reason?
- Conclusion
- Nothing in section 6109 or the regulations prohibits issuing an ITIN to a decedent with a legitimate tax need, and nothing compels it; the IRS treats such applications case by case.
IRS PDF: CCA 200925042 ↗
CCA 200909056 Chief Counsel Advice
Released February 27, 2009 · Issued December 17, 2008
IRC 3509
Worker classification and section 530Intentional disregard
- Issue
- Does section 3509 apply where the employer intentionally disregarded withholding requirements?
- Conclusion
- No. Section 3509 reduced rates are unavailable where the employer intentionally disregarded the requirement to withhold.
“3509 doesn't apply if intentionally disregard.” (IRS text)
IRS PDF: CCA 200909056 ↗
CCA 200906051 Chief Counsel Advice High relevance
Released February 6, 2009 · Issued October 27, 2008
IRC 3406, IRC 6041, IRC 104
Backup withholding: IRC 3406Who must file: IRC 6041
- Issue
- Does backup withholding apply to settlement payments that may be excludable damages under section 104(a)(2)?
- Conclusion
- Backup withholding applies only to reportable payments; payments that are not income, such as amounts excludable under section 104(a)(2), are not reportable under section 6041 and are not subject to backup withholding.
“payments which are not income, such as those excludable under sec. 104(a)(2), are not reportable under section 6041 and backup withholding does not apply” (IRS text)
IRS PDF: CCA 200906051 ↗
PLR 200906010 Private letter ruling
Released February 6, 2009 · Issued October 24, 2008
IRC 6041, IRC 3121, IRC 3401
Who must file: IRC 6041
- Issue
- Must an employer report court awarded attorney fees paid from a common fund to class counsel as income of class member employees?
- Conclusion
- No. The fees are not income or wages to class members or class representatives, so no section 6041 reporting to them and no employment taxes apply.
Related: PLR 200906012
IRS PDF: PLR 200906010 ↗
PMTA-2009-035 Program manager technical advice High relevance
Issued October 22, 2008 · Release date not published by the IRS
IRC 61, IRC 3402, IRC 3121, IRC 6041
Who must file: IRC 6041Worker classification and section 530
- Issue
- How should employment related judgments and settlements be characterized, taxed and reported (Form W-2 or 1099)?
- Conclusion
- A four step framework: characterize the payment, decide if it is gross income, decide if it is wages, then report wages on Form W-2 and non wage amounts and attorney fees on Form 1099; reference charts are included.
IRS PDF: PMTA-2009-035 ↗
PMTA-2008-02014 Program manager technical advice High relevance
Issued October 17, 2008 · Release date not published by the IRS
IRC 6050I, IRC 6721, IRC 6722, IRC 6501
Form 8300: IRC 6050IPenalties: IRC 6721 and 6722
- Issue
- Is there a limitations period for the section 6722 penalty, and can section 6721 be assessed for TIN omissions on Form 8300 filed years earlier?
- Conclusion
- No limitations period applies to section 6722 because no return is filed for payee statements, though assessing within three years avoids dispute; section 6721 may always be assessed for errors involving TINs, surnames or money amounts.
“The penalty under section 6721 may always be assessed on information returns that contain errors or omissions that relate to taxpayer identification numbers” (IRS text)
IRS PDF: PMTA-2008-02014 ↗
CCA 200840044 Chief Counsel Advice High relevance
Released October 3, 2008 · Issued August 5, 2008
IRC 6050I
Form 8300: IRC 6050I
- Issue
- When an agent receives more than $10,000 in cash on behalf of a principal, who files Form 8300?
- Conclusion
- The agent that receives the cash must file Form 8300 regardless of how it transmits the funds to the principal.
“The agent is required to file Form 8300, regardless of the method used to transmit the funds to the principal.” (IRS text)
Dollar amounts and rates are as stated in this 2008 document; see the current figures before relying on one.
IRS PDF: CCA 200840044 ↗
PMTA-2009-034 Program manager technical advice
Issued July 8, 2008 · Release date not published by the IRS
IRC 3509, IRC 3121
Worker classification and section 530
- Issue
- May state and local employers with section 218 agreements use section 3509 rates for workers later found covered by the agreement?
- Conclusion
- Yes. Section 3509 reduced rates are available for workers not treated as covered who are determined to be employees under section 3121(d)(4).
IRS PDF: PMTA-2009-034 ↗
CCA 200825043 Chief Counsel Advice
Released June 20, 2008 · Issued May 13, 2008
IRC 3509, IRC 6205
Worker classification and section 530
- Issue
- May an employer reclassifying workers after an IRS determination letter use section 3509 rates for prior years and make interest free adjustments?
- Conclusion
- Yes on both points, provided the employer meets the section 3509 requirements.
IRS PDF: CCA 200825043 ↗
PLR 200816027 Private letter ruling
Released April 18, 2008 · Issued January 8, 2008
IRC 6041, IRC 3406, IRC 1441, IRC 1442
Who must file: IRC 6041Backup withholding: IRC 3406Nonresident withholding: IRC 1441
- Issue
- Must a retailer report or withhold on promotional payments made to customers who bought qualifying merchandise?
- Conclusion
- The payments are purchase price reductions, not gross income, so the retailer has no section 6041 reporting obligation and no withholding under sections 1441, 1442 or 3406.
IRS PDF: PLR 200816027 ↗
PLR 200816014 Private letter ruling
Released April 18, 2008 · Issued January 15, 2008
IRC 6041, IRC 104
Who must file: IRC 6041
- Issue
- Must a qualified settlement fund report personal physical injury payments to tort claimants?
- Conclusion
- No. Payments up to the specified amount are excludable under section 104(a)(2) and no information return is required.
Parallel rulings to related tort settlement funds reach the same result; saved in src/.
Related: PLR 200834009, PLR 200834011, PLR 200835016, PLR 200835017, PLR 200912002
IRS PDF: PLR 200816014 ↗
PMTA-2008-01654 Program manager technical advice
Issued January 24, 2008 · Release date not published by the IRS
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Are retail sales of mobile homes sales of personal property for Form 8300 purposes?
- Conclusion
- Yes. Mobile homes sold at retail are consumer durables, so cashier's checks and similar instruments received in the sale can be cash requiring Form 8300.
IRS PDF: PMTA-2008-01654 ↗
PLR 200748010 Private letter ruling
Released November 30, 2007 · Issued August 29, 2007
IRC 6041, IRC 468B
Who must file: IRC 6041
- Issue
- What are a qualified settlement fund's section 6041 reporting obligations for compensatory damages, punitive damages, incentive awards and attorney fees?
- Conclusion
- No reporting for compensatory damages or amounts paid to third parties for costs and counsel; punitive damage portions and class representative incentive awards are reportable under section 6041.
IRS PDF: PLR 200748010 ↗
CCA 200707001 Chief Counsel Advice
Released February 16, 2007 · Issued December 22, 2006
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Is a deposit of currency and a cashier's check into a used car dealer's bank account by its contractor reportable on Form 8300?
- Conclusion
- No. A deposit into the dealer's own bank account is not the dealer's receipt of a cash payment for section 6050I purposes, and CTR rules do not change that.
IRS PDF: CCA 200707001 ↗
PLR 200704004 Private letter ruling High relevance
Released January 26, 2007 · Issued October 31, 2006
IRC 6041, IRC 6045, IRC 6049
Who must file: IRC 6041
- Issue
- Must a class action settlement fund report payments to class members, and are attorney fee payments reported under section 6041 or 6045(f)?
- Conclusion
- The fund has no section 6041 or 6049 obligation for class member payments it cannot characterize, but must report attorney fees of $600 or more to class counsel under section 6041(a), which displaces section 6045(f).
Dollar amounts and rates are as stated in this 2007 document; see the current figures before relying on one.
IRS PDF: PLR 200704004 ↗
PLR 200651003 Private letter ruling High relevance
Released December 22, 2006 · Issued September 15, 2006
IRC 6041
Who must file: IRC 6041
- Issue
- Must a city report siding removal grants to homeowners and payments it makes directly to contractors?
- Conclusion
- Yes. The grants are income to the owners, and because the city performs management and oversight it must also report direct payments to contractors on Form 1099-MISC.
IRS PDF: PLR 200651003 ↗
PLR 200645008 Private letter ruling High relevance
Released November 10, 2006 · Issued September 29, 2006
IRC 3406, IRC 6041, IRC 6045, IRC 6049
Backup withholding: IRC 3406Who must file: IRC 6041TIN solicitation and Form W-9
- Issue
- Must an SEC qualified settlement fund report and backup withhold on distributions to injured mutual fund investors, and must it solicit TINs from them?
- Conclusion
- Distributions compensating fund losses are not fixed or determinable income and are not reportable under sections 6041, 6045 or 6049, except direct payments to qualified plan participants, which are reportable on Form 1099-R; for those the fund may obtain TINs from plans, funds or transfer agents rather than soliciting the participants.
“The Fund will not be required to solicit TINs from the participants for purposes of applying the backup withholding rules” (IRS text)
Lead ruling in a series of 20 near identical PLRs issued to SEC market timing settlement funds; the parallel rulings are saved in src/ and reach the same conclusions.
Related: PLR 200645017, PLR 200646010, PLR 200701001, PLR 200702006, PLR 200702008, PLR 200702009, PLR 200702010, PLR 200702011, PLR 200702012, PLR 200702048, PLR 200703008, PLR 200703009, PLR 200703010, PLR 200703034, PLR 200712004, PLR 200712005, PLR 200722004, PLR 200722025, PLR 200819013
IRS PDF: PLR 200645008 ↗
CCA 200644017 Chief Counsel Advice
Released November 3, 2006 · Issued August 1, 2006
IRC 6050I
Form 8300: IRC 6050I
- Issue
- When a wholesaler hires a courier to collect and deposit cash from a customer, which party must file Form 8300?
- Conclusion
- The courier that received the cash in its trade or business for the wholesaler's account must file; the wholesaler did not itself receive cash.
IRS PDF: CCA 200644017 ↗
PLR 200625006 Private letter ruling
Released June 23, 2006 · Issued March 7, 2006
IRC 6041
Who must file: IRC 6041
- Issue
- Must a city report payments to property owners for converting multi unit buildings back to single family use?
- Conclusion
- Yes. The payments benefit a business or investment activity rather than individual need, so they are gross income and reportable under section 6041 unless the recipient is an exempt corporation.
IRS PDF: PLR 200625006 ↗
INFO 2006-0006 Information letter High relevance
Released March 21, 2006 · Issued February 28, 2006
IRC 6041
Who must file: IRC 6041TIN solicitation and Form W-9B notices and CP2100
- Issue
- Should the IRS eliminate Form 1099-MISC reporting of medical payments because of frequent TIN mismatches with hospitals and practice groups?
- Conclusion
- The IRS declined to eliminate reporting of medical and health care payments, including to corporations, and explains why mismatches arise and how payers should handle them.
IRS PDF: INFO 2006-0006 ↗
PLR 200609014 Private letter ruling
Released March 3, 2006 · Issued December 1, 2005
IRC 6041, IRC 468B
Who must file: IRC 6041
- Issue
- Must a securities fraud settlement trust report distributions to class members under section 6041?
- Conclusion
- No. The trust cannot determine whether or how much of a distribution is includible in a class member's income, so the payments are not fixed or determinable; attorney fees are not income to class members.
IRS PDF: PLR 200609014 ↗
PLR 200602016 Private letter ruling High relevance
Released January 13, 2006 · Issued September 28, 2005
IRC 6041, IRC 3406, IRC 468B
Who must file: IRC 6041Backup withholding: IRC 3406
- Issue
- Who is the transferor for a qualified settlement fund's section 6041 reporting, how is the $600 threshold measured, and when must the fund backup withhold?
- Conclusion
- The fund is treated as the payor for the $600 threshold, must report payments reportable under section 6041 to claimants, and must backup withhold only on reportable payments where the claimant fails to furnish a TIN; attorney fees paid to counsel retained by the liquidator are not income to claimants.
“the claimant fails to furnish a TIN to the Fund, the Fund will be required to backup withhold” (IRS text)
Dollar amounts and rates are as stated in this 2006 document; see the current figures before relying on one.
IRS PDF: PLR 200602016 ↗
INFO 2005-0214 Information letter
Released December 15, 2005 · Issued November 15, 2005
IRC 6041
Who must file: IRC 6041
- Issue
- Must a fiduciary agency file Forms 1099 for payments it makes from clients' commingled funds on their behalf?
- Conclusion
- Whether the fiduciary is the payor depends on management or oversight under Reg. 1.6041-1(e); personal payments of the principal are not reportable.
IRS PDF: INFO 2005-0214 ↗
PLR 200532025 Private letter ruling
Released August 12, 2005 · Issued May 3, 2005
IRC 6041
Who must file: IRC 6041
- Issue
- How should an online skill game site report tournament prizes under section 6041?
- Conclusion
- The tournaments are not wagering pools or lotteries; the entry fee is a return of capital, so only the prize net of the entry fee is income reportable under section 6041.
IRS PDF: PLR 200532025 ↗
PMTA-2007-00722 Program manager technical advice
Issued June 2, 2005 · Release date not published by the IRS
IRC 6723, IRC 6721, IRC 6722, IRC 6724, IRC 6109
Penalties: IRC 6721 and 6722TINs and EINs: IRC 6109
- Issue
- Which penalty applies when a Schedule K-1 is filed with an incorrect TIN?
- Conclusion
- Section 6723, the penalty for failure to comply with other information reporting requirements, is the appropriate penalty for an incorrect TIN on a Form 1065 or 1120S Schedule K-1 filed with the IRS.
“A penalty asserted under section 6723 would be the appropriate penalty” (IRS text)
IRS PDF: PMTA-2007-00722 ↗
CCA 200521031 Chief Counsel Advice
Released May 27, 2005 · Issued February 23, 2005
IRC 1441, IRC 6601
Nonresident withholding: IRC 1441Form 1042-S and withholding agents
- Issue
- Is a withholding agent in the section 1441 voluntary compliance program liable for interest on undocumented payments that later documentation shows were exempt or subject to a reduced rate?
- Conclusion
- No interest is owed to the extent later documentation establishes that no tax, or a lower tax, was actually due on the Form 1042 due date, because section 6601 interest requires an underpayment.
IRS PDF: CCA 200521031 ↗
PLR 200519002 Private letter ruling
Released May 13, 2005 · Issued January 19, 2005
IRC 6041
Who must file: IRC 6041
- Issue
- Must a city report property, sales and food and beverage tax rebates it pays to businesses as development incentives?
- Conclusion
- No reporting for the property and sales tax rebates, but the food and beverage tax amounts are not true rebates and are income the city must report under section 6041.
IRS PDF: PLR 200519002 ↗
PLR 200518040 Private letter ruling
Released May 6, 2005 · Issued January 18, 2005
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must a wholesale telecom provider file Forms 8300 for customer payments made as cash deposits into the provider's bank account?
- Conclusion
- The ruling analyzes whether cash deposited directly into the payee's bank account is cash received by the business in a reportable transaction.
IRS PDF: PLR 200518040 ↗
INFO 2005-0040 Information letter
Released March 22, 2005 · Issued March 2, 2005
IRC 6041, IRC 6041A
Who must file: IRC 6041
- Issue
- Must an escrow agent or listing broker report real estate commissions paid to the broker and salesperson?
- Conclusion
- The letter applies sections 6041 and 6041A and the paying agent rules to escrow disbursements of commissions and to the broker's payments to its salesperson.
IRS PDF: INFO 2005-0040 ↗
TAM 200501016 Technical advice memorandum High relevance
Released January 7, 2005 · Issued September 21, 2004
IRC 6050I, IRC 6721
Form 8300: IRC 6050IPenalties: IRC 6721 and 6722Intentional disregard
- Issue
- Must a retailer file Form 8300 when one customer buys multiple items at once with a series of cash payments over $10,000, and does the intentional disregard penalty apply?
- Conclusion
- The purchases are a single transaction requiring Form 8300, employees of the retailer are not separate recipients, and the retailer is liable for the section 6721(a) penalty but not the section 6721(e) intentional disregard penalty.
“X is not subject to the section 6721(e) Intentional Disregard penalty.” (IRS text)
Dollar amounts and rates are as stated in this 2005 document; see the current figures before relying on one.
IRS PDF: TAM 200501016 ↗
PLR 200450003 Private letter ruling
Released December 10, 2004 · Issued July 2, 2004
IRC 3406, IRC 1441, IRC 1442, IRC 1461, IRC 6041, IRC 6049
Backup withholding: IRC 3406Nonresident withholding: IRC 1441Form 1042-S and withholding agents
- Issue
- May a global custodian determine chapter 3 and backup withholding and Form 1042-S or 1099 reporting separately for each participant in a pooled custody account rather than treating the pool as a joint account?
- Conclusion
- Yes. The pool is not a legal entity, so the custodian may apply withholding and reporting participant by participant based on each participant's documentation and need not obtain a Form W-8IMY for the pool.
“Taxpayer is not required to treat a pool account as a “joint” account” (IRS text)
IRS PDF: PLR 200450003 ↗
TAM 200420028 Technical advice memorandum
Released May 14, 2004
IRC 6041
Who must file: IRC 6041
- Issue
- Must an Indian tribe issue a Form 1099 to a powwow contest winner who receives a cash prize of $600 or more?
- Conclusion
- Yes. The prize is fixed or determinable income reportable under section 6041.
Dollar amounts and rates are as stated in this 2004 document; see the current figures before relying on one.
IRS PDF: TAM 200420028 ↗
PLR 200340004 Private letter ruling High relevance
Released October 3, 2003 · Issued July 1, 2003
IRC 6041, IRC 6045, IRC 468B
Who must file: IRC 6041
- Issue
- Must a qualified settlement fund report court awarded attorney fees to class members, and does section 6041 or 6045(f) govern reporting to class counsel?
- Conclusion
- The fees are not income to class members and are not reported to them; the fund must report the fees to class counsel under section 6041, which displaces section 6045(f).
IRS PDF: PLR 200340004 ↗
PMTA-2007-00635 Program manager technical advice
Issued September 30, 2003 · Release date not published by the IRS
IRC 530, IRC 6041, IRC 3102
Worker classification and section 530Who must file: IRC 6041
- Issue
- Should information reporting for payments to section 530 workers be changed administratively, and may a business be required to withhold employee FICA on them?
- Conclusion
- Counsel reviews the Form 1099-MISC reporting rules for section 530 workers and the FICA liability framework; the specific recommendations and conclusions are redacted in the released copy.
IRS PDF: PMTA-2007-00635 ↗
INFO 2003-0051 Information letter
Released March 28, 2003 · Issued December 6, 2002
IRC 6041, IRC 6050N
Who must file: IRC 6041
- Issue
- Should publishers issue Forms 1099 for royalties to authors directly rather than to literary agents after the 2002 'on behalf of' regulations?
- Conclusion
- Reg. 1.6041-1(e) applies to section 6041 payments, not royalties reportable under section 6050N, so the prior royalty reporting practice through agents was not changed.
Related: INFO 2003-0008, INFO 2003-0039
IRS PDF: INFO 2003-0051 ↗
PMTA-2007-00592 Program manager technical advice
Issued February 28, 2003 · Release date not published by the IRS
IRC 6041
Who must file: IRC 6041
- Issue
- Must a state report on Form 1099 the interest and additions to tax it forgives under a tax amnesty program?
- Conclusion
- No. Forgiveness of interest and penalties is not a payment under section 6041 regardless of whether it is income to the taxpayer.
IRS PDF: PMTA-2007-00592 ↗
PLR 200244017 Private letter ruling High relevance
Released November 1, 2002 · Issued May 24, 2002
IRC 1441, IRC 1442, IRC 1443
Nonresident withholding: IRC 1441Form 1042-S and withholding agents
- Issue
- Must a U.S. law firm withhold under section 1441 on a referral fee paid to a nonresident alien attorney who worked mostly abroad but traveled to the U.S. for the case?
- Conclusion
- Compensation is sourced where services are performed; the portion attributable to services performed in the United States is U.S. source income subject to 30 percent withholding and Form 1042-S reporting, while the foreign services portion is not.
Dollar amounts and rates are as stated in this 2002 document; see the current figures before relying on one.
IRS PDF: PLR 200244017 ↗
PLR 200226018 Private letter ruling
Released June 28, 2002 · Issued March 22, 2002
IRC 3406, IRC 6041, IRC 6049, IRC 104
Backup withholding: IRC 3406Who must file: IRC 6041
- Issue
- Must a company making periodic workers compensation settlement payments on an employer's behalf file information returns and backup withhold?
- Conclusion
- No. Once the settlement is approved under the state labor code, the payments are excludable under section 104(a)(1), are not fixed or determinable income, are not reportable payments and are not subject to backup withholding.
IRS PDF: PLR 200226018 ↗
INFO 2002-0102 Information letter High relevance
Released June 25, 2002 · Issued June 14, 2002
IRC 6041
Who must file: IRC 6041
- Issue
- Must a property management company file Forms 1099-MISC for rent it collects and remits to property owners?
- Conclusion
- The letter applies the management or oversight test of Reg. 1.6041-1(e) to a manager that collects rents and pays expenses on owners' behalf.
IRS PDF: INFO 2002-0102 ↗
CCA 200224008 Chief Counsel Advice
Released June 14, 2002 · Issued March 31, 2000
IRC 6041, IRC 6051
Who must file: IRC 6041Worker classification and section 530
- Issue
- Should compensation paid to professionals such as attorneys and engineers be reported on Form W-2 or Form 1099-MISC?
- Conclusion
- It depends on worker status for each type of service; a worker can have dual status, with employee compensation on Form W-2 and independent contractor compensation on Form 1099-MISC.
IRS PDF: CCA 200224008 ↗
PLR 200222001 Private letter ruling
Released May 31, 2002 · Issued February 28, 2002
IRC 1441, IRC 6041, IRC 468B
Nonresident withholding: IRC 1441Who must file: IRC 6041
- Issue
- Must a qualified settlement fund report under section 6041 or withhold under section 1441 on medical monitoring reimbursements, product refunds and matrix compensation paid to class members?
- Conclusion
- The fund need not report or withhold on the excludable or non income payments and need not furnish duplicate payee statements for payments made directly to medical providers or for attorney fees paid to class counsel.
Reissued as PLR 200316040 with the same text; both PDFs are saved in src/.
IRS PDF: PLR 200222001 ↗
TAM 200212002 Technical advice memorandum
Released March 22, 2002 · Issued July 26, 2001
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must taxicab fleet owners who receive lease payments from drivers in cash file Forms 8300?
- Conclusion
- Yes. Related cash lease payments from a driver exceeding $10,000 in a year are reportable on Form 8300.
Dollar amounts and rates are as stated in this 2002 document; see the current figures before relying on one.
IRS PDF: TAM 200212002 ↗
INFO 2002-0026 Information letter
Released March 19, 2002 · Issued January 18, 2002
IRC 6109, IRC 6011
TINs and EINs: IRC 6109
- Issue
- May the IRS require a corporate officer's SSN on Form SS-4?
- Conclusion
- Yes. Sections 6011(a) and 6109 and the regulations authorize the IRS to require the responsible officer's name and SSN on the EIN application.
IRS PDF: INFO 2002-0026 ↗
CCA 200211046 Chief Counsel Advice
Released March 15, 2002 · Issued February 11, 2002
IRC 6050I
Form 8300: IRC 6050I
- Issue
- How does section 6050I apply when a retail or wholesale auto auction customer switches from currency to fifty $500 money orders?
- Conclusion
- Money orders under $10,000 received in a retail sale of a consumer durable, or where the recipient knows they are used to avoid reporting, are cash; a wholesale sale is not a designated reporting transaction, but knowledge of avoidance can still require Form 8300.
Dollar amounts and rates are as stated in this 2002 document; see the current figures before relying on one.
IRS PDF: CCA 200211046 ↗
CCA 200152047 Chief Counsel Advice
Released December 28, 2001 · Issued November 19, 2001
IRC 6050I
Form 8300: IRC 6050I
- Issue
- Must a business file Form 8300 when a customer offers cash but substitutes money orders or a personal check before completing the sale?
- Conclusion
- Receipt of cash is the trigger; where currency is returned and replaced by a personal check no Form 8300 is required, while money orders received in a designated retail sale can be cash if their face amounts and the facts meet the regulations.
IRS PDF: CCA 200152047 ↗
INFO 2001-0293 Information letter High relevance
Released December 10, 2001 · Issued November 5, 2001
IRC 6109, IRC 6721, IRC 6722, IRC 6724
TIN solicitation and Form W-9Penalties: IRC 6721 and 6722Reasonable cause: IRC 6724
- Issue
- What should an employer do when hiring a person who has no SSN or will not use one?
- Conclusion
- The employer still files Form W-2, faces $50 penalties per failure for the missing SSN, and may obtain waiver only by proper solicitations and a written reasonable cause statement under penalties of perjury.
Dollar amounts and rates are as stated in this 2001 document; see the current figures before relying on one.
IRS PDF: INFO 2001-0293 ↗
FSA 200148022 Field service advice High relevance
Released November 30, 2001 · Issued August 22, 2001
IRC 6041
Who must file: IRC 6041
- Issue
- Must a title insurance company issue Forms 1099 for commissions paid to its independent agents, including agents who are attorneys?
- Conclusion
- Yes. Commissions paid to independent agents are reportable under section 6041; the attorney question is moot.
IRS PDF: FSA 200148022 ↗
CCA 200142021 Chief Counsel Advice High relevance
Released October 19, 2001 · Issued September 5, 2001
IRC 6721, IRC 6722, IRC 6501, IRC 6041
Penalties: IRC 6721 and 6722Who must file: IRC 6041
- Issue
- Is there a statute of limitations on assessing sections 6721 and 6722 penalties when a company fails to issue Forms 1099 to its agents?
- Conclusion
- The penalties are assessable without deficiency procedures; the three year period under section 6501 runs only from the filing of a return, so where no Forms 1099 were filed the period for the section 6721 penalty has not begun to run.
IRS PDF: CCA 200142021 ↗
INFO 2001-0245 Information letter High relevance
Released September 24, 2001 · Issued September 7, 2001
IRC 6724, IRC 6721, IRC 6049, IRC 3406
Reasonable cause: IRC 6724TIN solicitation and Form W-9Penalties: IRC 6721 and 6722
- Issue
- Can banks penalized for incorrect payee TINs on savings bond interest returns get a reasonable cause waiver?
- Conclusion
- Yes, if the bank complied with the specific TIN solicitation rules in Reg. 31.3406(b)(2)-3(c) it is treated as acting in a responsible manner and may request a section 6724 waiver.
IRS PDF: INFO 2001-0245 ↗
INFO 2001-0191 Information letter
Released September 21, 2001 · Issued July 18, 2001
IRC 6051, IRC 6041
Electronic filingCorrections and revocations
- Issue
- What security rules apply to furnishing payee statements electronically?
- Conclusion
- The electronic payee statement regulations then covered only Forms W-2, 1098-E and 1098-T and require payee consent and demonstrated access before posting replaces paper.
IRS PDF: INFO 2001-0191 ↗
SCA 200130038 Service center advice
Released July 27, 2001 · Issued May 31, 2001
IRC 6041, IRC 6050P
Who must file: IRC 6041Corrections and revocations
- Issue
- Reconsideration of how a hospital reports student loan debt it cancels in exchange for a physician's services.
- Conclusion
- Debt cancelled in exchange for services is compensation reportable on Form 1099-MISC for a non employee (or Form W-2 for an employee); section 6050P Form 1099-C reporting applies only to applicable entities.
IRS PDF: SCA 200130038 ↗
CCA 200127043 Chief Counsel Advice High relevance
Released July 6, 2001 · Issued April 25, 2001
IRC 6721, IRC 6204
Penalties: IRC 6721 and 6722Intentional disregard
- Issue
- Can the IRS assess both the section 6721(a) penalty and the section 6721(e) intentional disregard penalty for the same return, and can it move from (a) to (e) later?
- Conclusion
- Only one penalty applies per return, so (a) and (e) cannot both be assessed for the same failure; but if intentional disregard is found after an (a) assessment, the IRS may supplement the assessment under section 6204(a) to the higher (e) amount.
“the Service cannot assess penalties against a taxpayer for the same violation under both sections 6721(a) and 6721(e)” (IRS text)
IRS PDF: CCA 200127043 ↗
INFO 2001-0077 Information letter
Released June 29, 2001 · Issued February 9, 2001
IRC 3406
TIN solicitation and Form W-9Backup withholding: IRC 3406
- Issue
- Will the IRS delay mandatory use of the revised Form W-9 that added a new certification?
- Conclusion
- Yes. Announcement 2001-15 postponed required use of the new Form W-9 to July 1, 2001 so payors could reprint substitute forms.
Related: INFO 2001-0076, INFO 2001-0078
IRS PDF: INFO 2001-0077 ↗
INFO 2001-0101 Information letter
Released June 29, 2001 · Issued March 27, 2001
IRC 6041
Who must file: IRC 6041
- Issue
- Does the freight exception to Form 1099-MISC reporting cover payments to independent truck drivers?
- Conclusion
- The letter explains that Reg. 1.6041-3(d) excepts payments of freight and similar charges from reporting, with reference to the integral freight analysis.
IRS PDF: INFO 2001-0101 ↗
INFO 2001-0144 Information letter High relevance
Released June 29, 2001 · Issued May 18, 2001
IRC 6721, IRC 6724, IRC 6051
Penalties: IRC 6721 and 6722Reasonable cause: IRC 6724TIN solicitation and Form W-9
- Issue
- Is an employer penalized for omitting an employee's SSN from Form W-2 when the employee refuses on religious grounds, and can the penalty be waived?
- Conclusion
- The omission is a section 6721 failure, but the de minimis exception may apply and reasonable cause waiver is available if the employer solicited the number as the regulations require.
IRS PDF: INFO 2001-0144 ↗
SCA 200113001 Service center advice
Released March 30, 2001 · Issued February 17, 1999
IRC 6071, IRC 6041
Electronic filingWho must file: IRC 6041
- Issue
- Does section 6071(b) automatically extend the due date for electronically filed information returns to March 31, and which forms does it cover?
- Conclusion
- Yes, for returns due the last day of February under sections 6041 to 6053; it does not apply to Forms 1042-S, 5498 or 5498-MSA, and a March 31 weekend or holiday rolls to the next business day.
IRS PDF: SCA 200113001 ↗
PLR 200107027 Private letter ruling High relevance
Released February 16, 2001 · Issued November 20, 2000
IRC 3406, IRC 6724
Backup withholding: IRC 3406Reasonable cause: IRC 6724TIN solicitation and Form W-9
- Issue
- May a clearing broker rely on an introducing broker's notifications about Forms W-9, pre-1984 account status and TINs for backup withholding and penalty purposes when accounts are transferred in bulk?
- Conclusion
- Yes. Under section 3406(d)(2)(B) and Reg. 31.3406(d)-4 the payor may rely on the introducing broker's notifications, need not obtain new Forms W-9, may rely on faxed or electronically transmitted W-9s, and using the TIN furnished by the broker satisfies the initial solicitation rule of Reg. 301.6724-1(f).
“X need not obtain a signed W-9 and may rely on notification from the Introducing Broker” (IRS text)
IRS PDF: PLR 200107027 ↗
PLR 200106032 Private letter ruling High relevance
Released February 9, 2001 · Issued November 13, 2000
IRC 6041
Who must file: IRC 6041
- Issue
- Must a funeral home issue Forms 1099 to clergy, florists and other third party providers it pays as cash advances on behalf of families?
- Conclusion
- No. The funeral home acts for the families without management or oversight or economic interest, so it is not the payor; telephone and transportation charges are also excepted.
“X is not required to issue information returns to service providers for those payments made on behalf of a family” (IRS text)
IRS PDF: PLR 200106032 ↗
SCA 200101031 Service center advice High relevance
Released January 5, 2001 · Issued October 31, 2000
IRC 6721, IRC 6724, IRC 6050L
Penalties: IRC 6721 and 6722Reasonable cause: IRC 6724TIN solicitation and Form W-9
- Issue
- How should a service center decide whether to penalize a donee organization that files Form 8282 without the donor's TIN?
- Conclusion
- Omitting a required TIN is a failure to file a correct information return under section 6721, but the penalty may be waived for reasonable cause, which the donee can show by proving the donor refused to furnish the TIN.
“The donee may demonstrate reasonable cause by showing that the failure was due to the donor’s refusal to provide the TIN.” (IRS text)
IRS PDF: SCA 200101031 ↗
INFO 2000-0394 Information letter High relevance
Released December 29, 2000 · Issued November 20, 2000
IRC 6109, IRC 6721, IRC 6724
TIN solicitation and Form W-9Penalties: IRC 6721 and 6722Reasonable cause: IRC 6724
- Issue
- What penalty does an employer face when a new employee refuses to furnish an SSN for Form W-2, and how is it avoided?
- Conclusion
- The employer must solicit the SSN, may be penalized under sections 6721 and 6722 for a Form W-2 lacking it, and can obtain a reasonable cause waiver by documenting proper solicitations.
IRS PDF: INFO 2000-0394 ↗
SCA 200040034 Service center advice High relevance
Released October 6, 2000 · Issued August 25, 2000
IRC 6109
TINs and EINs: IRC 6109TIN solicitation and Form W-9
- Issue
- Does the Code restrict a state payor from requesting a payee's EIN before it makes a reportable payment?
- Conclusion
- No. Nothing in the Code or regulations prevents a payor from requesting an identifying number before making a reportable payment.
“Neither the Code nor the regulations prohibits State from requesting an EIN from an individual prior to State making a reportable payment” (IRS text)
IRS PDF: SCA 200040034 ↗
INFO 2000-0211 Information letter High relevance
Released September 30, 2000
IRC 3406, IRC 6413
Backup withholding: IRC 3406Corrections and revocations
- Issue
- How does backup withholding work and can a payor refund amounts withheld in error?
- Conclusion
- A payor may refund erroneously withheld amounts only before year end and before furnishing the Form 1099; otherwise the payee claims the credit on his return.
“refunding of erroneously withheld amounts is completely within the discretion of the payor” (IRS text)
IRS PDF: INFO 2000-0211 ↗
CCA 200038045 Chief Counsel Advice High relevance
Released September 22, 2000 · Issued August 9, 2000
IRC 3509, IRC 3121, IRC 530
Worker classification and section 530Who must file: IRC 6041
- Issue
- Are corporate officers eligible for section 530 relief, is filing Form 1099 enough to show consistent treatment, and do section 3509 rates apply to officer misclassification?
- Conclusion
- Officers may qualify for section 530 relief and a Form 1099 can establish non employee treatment; Counsel addresses when a section 7436 notice is appropriate, CSP availability, and application of section 3509 rates.
IRS PDF: CCA 200038045 ↗
SCA 200028032 Service center advice
Released July 14, 2000 · Issued May 23, 2000
IRC 6109, IRC 6041
TINs and EINs: IRC 6109TIN solicitation and Form W-9Who must file: IRC 6041
- Issue
- May a state payor request an EIN from a person who claims to act as fiduciary of an estate before paying $600 or more, and should the IRS issue an EIN to someone who says he is not the fiduciary?
- Conclusion
- Yes, a payor may request the fiduciary's EIN for information reporting; the IRS should not issue an estate EIN to a person who states he is not the fiduciary.
Dollar amounts and rates are as stated in this 2000 document; see the current figures before relying on one.
IRS PDF: SCA 200028032 ↗
INFO 2000-0011 Information letter
Released June 30, 2000 · Issued March 2, 2000
IRC 3406
Backup withholding: IRC 3406B notices and CP2100
- Issue
- Why did a broker withhold 'TEFRA tax' on a constituent's dividends?
- Conclusion
- The letter explains the four backup withholding triggers, including the B notice sequence after IRS incorrect TIN notices, and how a payee stops withholding.
IRS PDF: INFO 2000-0011 ↗
INFO 2000-0040 Information letter
Released June 30, 2000 · Issued April 25, 2000
IRC 6109
TIN solicitation and Form W-9TINs and EINs: IRC 6109
- Issue
- Must a bank request a customer's TIN?
- Conclusion
- Yes. Section 6109(a)(3) requires a person filing a return about another person to request that person's TIN, and section 6109(a)(2) requires the person to furnish it; Bank Secrecy Act rules impose separate requirements.
IRS PDF: INFO 2000-0040 ↗
SCA 200016001 Service center advice
Released April 21, 2000 · Issued August 27, 1999
IRC 6721, IRC 6511
Penalties: IRC 6721 and 6722
- Issue
- What is the limitations period for a claim for refund of a section 6721 information return penalty?
- Conclusion
- A refund claim for a section 6721 penalty must be filed within two years of payment under section 6511(a), because no return is filed for the penalty itself.
“2 years from the date the penalty was paid” (IRS text)
IRS PDF: SCA 200016001 ↗
CCA 200012080 Chief Counsel Advice
Released March 24, 2000 · Issued December 28, 1999
IRC 6041, IRC 6049
Who must file: IRC 6041Corrections and revocations
- Issue
- Modification of CCA 199947029 on the form for reporting the interest component of a condemnation award.
- Conclusion
- Under the Form 1099-INT instructions, interest of $600 or more that does not meet the section 6049 definition is reported on Form 1099-INT rather than Form 1099-MISC.
Dollar amounts and rates are as stated in this 2000 document; see the current figures before relying on one.
IRS PDF: CCA 200012080 ↗
PLR 200005019 Private letter ruling
Released February 4, 2000 · Issued November 5, 1999
IRC 3406, IRC 6041, IRC 6045
Backup withholding: IRC 3406Who must file: IRC 6041
- Issue
- Are a foreign holding company and its transfer agent subject to Form 1099 reporting and backup withholding on IPO sale proceeds paid to U.S. policyholders in a demutualization?
- Conclusion
- Neither is a broker under section 6045, payments by a broker to a customer are excepted from section 6041, so no reporting and no backup withholding applies to those payments.
IRS PDF: PLR 200005019 ↗
SCA 200003008 Service center advice
Released January 21, 2000 · Issued October 15, 1999
IRC 6041, IRC 6050P
Who must file: IRC 6041
- Issue
- How does a hospital report loan forgiveness for a physician under a recruitment agreement?
- Conclusion
- On Form W-2 if the physician is an employee; otherwise the hospital may have to report on Form 1099-C under section 6050P (later modified by SCA 200130038 to Form 1099-MISC).
IRS PDF: SCA 200003008 ↗
CCA 199950035 Chief Counsel Advice High relevance
Released December 17, 1999 · Issued November 2, 1999
IRC 530, IRC 6041, IRC 3401
Worker classification and section 530Who must file: IRC 6041
- Issue
- Is a bail bond company entitled to section 530 relief, and are commissions its agents retain from collected premiums reportable on Form 1099?
- Conclusion
- The company qualifies for section 530 relief, and retained commissions of $600 or more are treated as paid by the company and must be reported under section 6041.
Dollar amounts and rates are as stated in this 1999 document; see the current figures before relying on one.
IRS PDF: CCA 199950035 ↗
CCA 199947029 Chief Counsel Advice
Released November 26, 1999 · Issued October 4, 1999
IRC 6041, IRC 6045, IRC 6049
Who must file: IRC 6041
- Issue
- What information returns apply when a state's lump sum condemnation payment includes both the property price and interest?
- Conclusion
- The proceeds are reported on Form 1099-S under section 6045(e) and the interest component is reportable under section 6041; a follow up memo moved the interest to Form 1099-INT.
IRS PDF: CCA 199947029 ↗
CCA 199944022 Chief Counsel Advice High relevance
Released November 5, 1999 · Issued August 3, 1999
IRC 6041
Who must file: IRC 6041
- Issue
- Must a government agency issue Forms 1099 to family day care providers it pays $600 or more per year?
- Conclusion
- Yes. The payments are trade or business income to the providers and the agency must file Forms 1099.
Dollar amounts and rates are as stated in this 1999 document; see the current figures before relying on one.
IRS PDF: CCA 199944022 ↗
PLR 199941036 Private letter ruling
Released October 15, 1999 · Issued July 22, 1999
IRC 6041, IRC 104
Who must file: IRC 6041
- Issue
- Must a structured settlement company report periodic payments sent to factoring companies or garnishors who acquired claimants' payment rights?
- Conclusion
- No. The periodic payments remain excludable damages under section 104(a)(2) and are not reportable under section 6041 to the factoring companies or the garnishor.
IRS PDF: PLR 199941036 ↗
SCA 199932004 Service center advice
Released August 13, 1999 · Issued March 11, 1999
IRC 6041, IRC 3401, IRC 3121
Who must file: IRC 6041
- Issue
- How are payments to jurors reported?
- Conclusion
- Juror compensation of $600 or more is reported under section 6041 on Form 1099-MISC box 3 as other income and is not subject to income tax or FICA withholding.
Dollar amounts and rates are as stated in this 1999 document; see the current figures before relying on one.
IRS PDF: SCA 199932004 ↗
CCA 199928029 Chief Counsel Advice High relevance
Released July 16, 1999 · Issued May 14, 1999
IRC 6041
Who must file: IRC 6041
- Issue
- Are personal injury attorneys who pay clients' medical bills out of settlement proceeds payors required to file Forms 1099?
- Conclusion
- An attorney is the payor subject to section 6041 if he exercises management and oversight over the payments; if he is merely a paying agent, the client is the payor.
IRS PDF: CCA 199928029 ↗
CCA 199919032 Chief Counsel Advice High relevance
Released May 14, 1999 · Issued March 17, 1999
IRC 6041
Who must file: IRC 6041
- Issue
- Does the freight exception in Reg. 1.6041-3(d) cover only incidental freight costs or also freight that is integral to a taxpayer's business?
- Conclusion
- The freight exception covers both incidental freight and freight payments that are an integral part of the business, so such payments are not reportable.
“includes not only a taxpayer’s payment of incidental freight costs during the taxable year but also payments of freight that are an integral part” (IRS text)
IRS PDF: CCA 199919032 ↗
PLR 199909046 Private letter ruling High relevance
Released March 5, 1999 · Issued December 7, 1998
IRC 6041, IRC 74
Who must file: IRC 6041
- Issue
- Must a manufacturer file Forms 1099 for incentive trips awarded to noncorporate dealers, and for the individuals the dealers designate to travel?
- Conclusion
- Trips worth $600 or more are prizes reportable under section 6041 to the noncorporate dealer; no return is required for the designated individuals.
Dollar amounts and rates are as stated in this 1999 document; see the current figures before relying on one.
IRS PDF: PLR 199909046 ↗
TAM 199906037 Technical advice memorandum High relevance
Released February 12, 1999
IRC 3406, IRC 6041
Backup withholding: IRC 3406Who must file: IRC 6041TIN solicitation and Form W-9
- Issue
- Were payments to independent contractors that were reportable under section 6041 subject to backup withholding when the payor never obtained the contractors' TINs?
- Conclusion
- Yes. The payments were reportable payments and, because the payor failed to obtain TINs at the time of payment, the payor was liable for backup withholding under section 3406.
“the payments are subject to the backup withholding under section 3406 of the Code” (IRS text)
IRS PDF: TAM 199906037 ↗
FSA 199905005 Field service advice
Released February 5, 1999 · Issued October 28, 1998
IRC 1441, IRC 1461, IRC 1463, IRC 6651, IRC 6656
Nonresident withholding: IRC 1441Form 1042-S and withholding agentsReasonable cause: IRC 6724
- Issue
- Was a withholding agent's failure to file Forms 1042 and 1042-S and to deposit withholding tax due to reasonable cause?
- Conclusion
- The record was insufficient to decide reasonable cause; Counsel outlines the facts examiners must develop about the agent's knowledge and reliance.
IRS PDF: FSA 199905005 ↗
PLR 199901008 Private letter ruling
Released January 8, 1999 · Issued September 29, 1998
IRC 6041, IRC 483, IRC 1274
Who must file: IRC 6041
- Issue
- Must a food company report interest and unstated interest paid to commodity producers under deferred payment contracts?
- Conclusion
- Yes. Interest, including unstated interest and OID, paid to noncorporate producers of $600 or more must be reported, and thresholds are tested contract by contract.
Dollar amounts and rates are as stated in this 1999 document; see the current figures before relying on one.
IRS PDF: PLR 199901008 ↗
PMTA-2007-00208 Program manager technical advice
Issued June 2, 1998 · Release date not published by the IRS
IRC 6041, IRC 6045
Who must file: IRC 6041
- Issue
- Are payments for standing or harvested timber reportable on Forms 1099?
- Conclusion
- Purchases of harvested timber are merchandise excepted from section 6041; sales of standing timber are excepted from Form 1099-S real estate reporting, and royalty style pay as cut payments are reportable except to corporations.
IRS PDF: PMTA-2007-00208 ↗
PMTA-2007-00170 Program manager technical advice
Issued September 17, 1997 · Release date not published by the IRS
IRC 6109
TINs and EINs: IRC 6109
- Issue
- May the IRS refuse to issue an EIN to a trust that appears to be an abusive trust?
- Conclusion
- Not solely for that reason, but the IRS may refuse or withdraw an EIN when the Form SS-4 is incomplete or incorrect.
IRS PDF: PMTA-2007-00170 ↗
PMTA-2007-00035 Program manager technical advice High relevance
Issued August 3, 1995 · Release date not published by the IRS
IRC 3406, IRC 3402
Backup withholding: IRC 3406
- Issue
- Does Policy Statement P-2-4 (no penalties against federal agencies) cover backup withholding, and can backup withholding be applied where a payor has a TIN but deliberately fails to issue Form W-2G?
- Conclusion
- Backup withholding is a tax, not a penalty, so P-2-4 does not apply; where the payee furnished a TIN that is not obviously incorrect, backup withholding is not required unless another section 3406(a) condition exists.
“with a TIN that is not obviously incorrect then backup withholding is not required” (IRS text)
IRS PDF: PMTA-2007-00035 ↗
PMTA-2007-00014 Program manager technical advice High relevance
Issued March 17, 1995 · Release date not published by the IRS
IRC 3406, IRC 6103
Backup withholding: IRC 3406TIN solicitation and Form W-9
- Issue
- May filers batch match payee names and TINs against IRS records before filing, and does section 3406 authorize disclosure?
- Conclusion
- Section 3406(a)(1)(B) contemplates notice of incorrect TINs after filing, but section 3406(i) authorized the TIN matching regulation that lets the IRS tell a payor before filing that a TIN does not match.
IRS PDF: PMTA-2007-00014 ↗
PMTA-2007-00013 Program manager technical advice High relevance
Issued March 14, 1995 · Release date not published by the IRS
IRC 6656, IRC 3504
Reasonable cause: IRC 6724
- Issue
- Does an employer have reasonable cause for a failure to deposit penalty when its third party payroll processor received the funds but deposited late?
- Conclusion
- Under Boyle, reliance on a processor alone is not reasonable cause; the employer has reasonable cause only if the processor itself had what amounts to reasonable cause, and the employer remains liable regardless of any section 3504 agreement.
“Under Boyle, reliance on a Processor, by itself, does not provide reasonable cause regardless of the care with which the employer chooses a Processor.” (IRS text)
IRS PDF: PMTA-2007-00013 ↗