Tax & Accounting Blog

IRS Adds Form 1099-B to the Combined Federal/State Reporting Program

1099, Information Reporting for Wealth Management, Tax Information Reporting, Trust Tax January 10, 2013

LisbonThe IRS has added Form 1099-B, Proceeds From Broker and Barter Exchange Transactions, to the Combined Federal/State Reporting Program (CFSFP) beginning with the filing of Forms 1099-B for tax year 2012.

As detailed in IRS Announcement 2013-3, this change is an important revision to the IRS electronic file specifications which originally were issued in the 2012 edition of IRS Publication 1220.  Announcement 2013-3 describes the updates which must be made to the IRS file to report 1099-Bs to state tax agencies through the combined filing program for 2012.

More than 30 states participate in the CFSFP, through which the filer authorizes the IRS to forward Form 1099 reported data to individual state tax agencies as specified by the filer in the IRS electronic file.  Not all states require Form 1099-B filing, and some require it only for Forms 1099-B which report the withholding of income tax for that particular state.  Since the addition of Form 1099-B to the CFSFP is a late change in the federal combined program, filers may need to check with state tax agencies to determine which of them will be accepting Form 1099-B combined filings for the 2012 tax year.