Missing an IRS Form 1099? Don’t Ask, Always Tell
A lot of accounting is simply acquiring and organizing paperwork. Most forms have to be submitted with a return, making it necessary to get paper copies of almost everything. However, the Form 1099 does not have to be attached to customer returns, and replacing a duplicate can cause a variety of snafus. While it is mandatory to report all income, it’s better to do without this form if it never shows up in the mailbox.
Regulations Regarding Form 1099
Businesses are required to send out a Form 1099 for a variety of income, including dividends, interest, state and local tax returns, unemployment benefits, and more. The IRS also receives these returns and matches them against individual returns. This means that reporting income is absolutely mandatory. However, most people do not need the physical form. We know how much we earned from different sources or can call to get this information.
The Case of the Missing Form 1099
Whether because of poor mail service or a changed address, some forms never end up with their rightful taxpaying owner. When this occurs, people may be tempted to call and ask for a duplicate. However, this can have complicated consequences. In many cases, the issuing of a duplicate leads to the appearance of duplicate income on IRS servers. This can lead to the dreaded audit. While these issues are cleared up quickly, they can produce a great deal of stress and inconvenience.
Taxpayers should report the income on a missing Form 1099, which sometimes requires calling the issuer to discover an exact amount. Asking for a new one is generally a bad idea. Because these do not have to be attached to the return, only the number is needed.
Keeping it simple rarely is the rule when it comes to the IRS. This situation is a notable exception. When missing an IRS Form 1099, never ask and always tell. This approach should avoid both penalties and a wide variety of unwanted downstream effects.