The IRS Form CP2100 and CP2100a , commonly known as the "B-Notice", is used to notify information reporters as to incorrect or incomplete payee names and/or taxpayer identification numbers on forms filed with the IRS. The number of such forms issued has risen 40% in the past six years. As such your AP department had better be ready for another trying B-Notice season.

In 2006 the IRS issued 3.6 million B-Notices. In 2011 the total number of B-Notices issued had climbed to 4.7 million. This year, it is expected that over 5 million B-Notices will be issued. As such, the odds that your organization will see an additional number of B-Notices has greatly increased. Remember also that fines and penalties have also risen; from $50 to $100 per violation and with a maximum penalty now up to $1.5 million (it formerly was $250,000). The full ramping up of Form 1099-K reporting, and the new FATCA final regulations are also expected to have a significant impact in terms of accelerating the number of B-Notices issued this year.

If your organization's AP and tax department require additional training or has questions regarding effectively processing its B-Notices and setting up systems to better handle the increased compliance load then please note that our TIR Answer Center is a unique subscription service providing you with your very own on-call corporate tax attorneys who answer all your questions in two business days or less. TIR Answer Center subscribers also enjoy substantial discounts off our customized training programs. For more information please do not hesitate to ask!