Tax & Accounting Blog

Want Proof of Mailing to the IRS on Time?

Want Proof of Mailing to the IRS on Time?

Don’t Rely on USPS First Class, Priority Mail or Delivery Confirmation Service Did you know that the only ways to establish prima facie evidence of delivery of documents that have a filing deadline prescribed by the Internal Revenue laws are the delivery methods that are specifically authorized in the tax regulations for timely mailing as … Read More

IRS Will Allow Substitute Forms W-8BEN to Document the Foreign Status of a Payee that Otherwise Would be Reported on the New Form 1099-K

IRS Will Allow Substitute Forms W-8BEN to Document the Foreign Status of a Payee that Otherwise Would be Reported on the New Form 1099-K

The new Form 1099-K will be used for tax information reporting of the gross amounts paid by a settlement entity to its participating payees.  Participating payees that will be reported are recipients that accept payment cards as a means of payment, and recipients that accept payment through third-party settlement organizations.  Payees with a foreign address … Read More

6050W Guidance – U.S. Payors Making Payments Outside the U.S.

6050W Guidance – U.S. Payors Making Payments Outside the U.S.

Issued by the IRS on August 19, Notice 2011-71 provides interim guidance under section 6050W of the Internal Revenue Code.  In summary, the guidance provides relief from some 6050W reporting and documentation requirements for payment settlement entities who are U.S. payors making payments to offshore accounts.   The Notice is the result of comments … Read More

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What Is a MOU in Relation to Electronic Forms W-8 and W-9?

A Memorandum of Understanding (MOU) is a document describing a bilateral or multilateral agreement between parties. It expresses a convergence of will between the parties, indicating an intended common line of action. It is often used in cases where parties either do not imply a legal commitment or in situations where the parties cannot create … Read More

IRS Agrees to the Use of a Substitute W-8BEN for Internal Revenue Code Section 6050W

IRS Agrees to the Use of a Substitute W-8BEN for Internal Revenue Code Section 6050W

IRS Notice 2011-71 simplifies payee documentation rules for payments from an offshore payer settled to an offshore account and permits substitute forms in lieu of Form W-8BEN. Background of Section 6050W Section 6050W — added to the Code by the Housing Assistance Tax Act of 2008 (Pub. L. No. 110-289) — requires annual information returns … Read More

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Form 1099-K and I.R.C. Section 6050W Questions and Answers in an Online IRS FAQ

The IRS offers 30 questions and answers at http://www.irs.gov/pub/irs-utl/irdm_section_6050w_faqs_7_23_11.pdf to help explain who has an obligation to file information returns for 2011 under the rules for Section 6050W of the Internal Revenue Code (I.R.C.), and when and how to file those new Form 1099-K information returns. If you are one of the many Tax, Operations, and Accounts … Read More