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Today, the IRS announced that in response to the COVID-19 virus, it will provide an extension of time for a Reporting Model 2 FFI (Foreign Financial Institution) or a Participating FFI to file the FATCA (Foreign Account Tax Compliance Act) Report (Form 8966) to the IRS. 

Last month the National Taxpayer Advocate issued its latest report. For those of you in Accounts Payable, Tax, or who are maybe an independent CPA representing business clients there were several important nuggets of information. The biggest takeaway is that, among other things, the IRS has essentially abdicated its responsibility to provide even a modicum of assistance to 1099 filers struggling to understand the blizzard of changes made in the law over the past few years.

Let's go to the report:

On January 6, 2020 the IRS released its annual report on the state of IRS operations and enforcement. If you are in Accounts Payable/Tax or maybe are a CPA then you definitely want to take note. 2020 is shaping up to be a much more difficult due diligence and filing year than even 2019.

As if record-high IRS enforcement revenue wasn't bad enough the Department of Labor (DOL) has been racking up record fine collections of its own. To wit, last year the DOL reported recovering a record high $304 million dollars redistributed from employers to workers because those employers are alleged to have misclassified those same workers as 1099 reportable independent contractors when the DOL found them to be W-2 reportable workers.

Earlier this month the IRS announced a dubious record (at least for those of you in Accounts Payable & Tax). So far for TY2018 (meaning the filing your organizations and clients did earlier this year) the IRS reports that it collected an all-time record high amount of $59.4 Billion in enforcement revenue.

A special heads-up to our readers. Please note that our friends over at Accounts Payable Now & Tomorrow have expanded their much anticipated annual AP appreciation week. Though we here at TIR Consulting focus on 1099/1042-S reporting, we also recognize there is much more to an AP professional's job than dealing with (the admittedly) onerous federal and state level due diligence/filing obligations.

On June 25th Accounting Today reported the IRS is aggressively seeking to expand it's tax enforcement and 1099 compliance capabilities via a new hiring push.

Earlier today National TaxPayer Advocate Nina Olson released her latest report to Congress regarding the state of IRS services - and it's not pretty.

In short, if your organization has 1099 related filing and due diligence questions then don't expect answers from the IRS. According to Olson's new report; " IRS telephone assistors during the recent filing season answered just 25 percent of taxpayer calls enterprise-wide."

Yesterday, Marketwatch reported that KPMG has been cheating way more than understood. Moreover, they have been doing so in terms of, among other things, the training their employees need to complete to be considered competent dispensing 1099 related compliance and filing guidance to their clients.

Here's the sordid details (as reported by Marketwatch):

Subscriber Question #1:

We received a W-9 from a vendor. In box 3 they checked "Limited Liability Company and entered their tax classification as a "C-Corp". Is there anything we need to do to verify if they are a corporation before we decide not to 1099 report them?

TIR Answer Center Response: