IRS to send notices of backup withholding errors in late April

Beginning in mid-April 2022, the Internal Revenue Service will issue CP2100 and CP2100A notices to financial institutions, businesses, or payers that have filed certain types of information returns that do not match IRS records.

These information statements include:

  • Form 1099-B, Proceeds from Brokerage and Barter Transactions
  • Form 1099-DIV, Dividends and Distributions
  • Form 1099-G, Certain Government Payments
  • Form 1099-INT, Interest Income
  • Form 1099-K, Payment Card and Third-Party Network Transactions
  • Form 1099-MISC, Miscellaneous Revenue
  • Form 1099-NEC, Nonemployee Compensation
  • Form 1099-OID, original remittance
  • Form 1099-PATR, Taxable Distributions Received from Co-ops
  • Form W-2G, Certain Gambling Winnings

The CP2100 and CP2100A notices are sent twice a year; a first shipment in September and October and a second in April of the following year. Notices inform payers that the information return does not have a tax identification number (TIN), it has an incorrect name, or a combination of both.

Each notice contains a list of recipients or people receiving certain types of income payments, with identified TIN issues. Payers should compare the accounts listed on the notice with their account statements and correct or update their statements, if necessary. This may also include the correction of backup withholding on payments made to beneficiaries.

The notices also inform payers that they are responsible for backup withholding. Payments reported in the information returns listed above are subject to backup withholding if:

  • The payer does not have the payee’s TIN when making reportable payments.
  • Beneficiary does not certify their TIN as required for reportable interest, dividend, brokerage, and barter accounts.
  • The IRS notifies the payer that the payee provided an incorrect TIN and the payee is not certifying their TIN as required.
  • The IRS notifies the payer to start withholding because the payee did not report all of their interest and dividends on their tax return.

Payers remain responsible for the amount they failed to withhold, and penalties may apply. Publication 1281, Backup Withholding on Missing and Incorrect Names/TINs PDF, contains more information to help payers comply with backup withholding.

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