Tax & Accounting Blog

Government Entities: One Step Closer to Repeal of the Law that Requires 3% Withholding on Vendor Payments

Government Entities: One Step Closer to Repeal of the Law that Requires 3% Withholding on Vendor Payments

The United States Senate joined the House of Representatives in passing H.R. 674 to repeal the 3% withholding requirement that is currently scheduled to begin in 2013 for vendor payments made by federal, state and local governments and their agencies and instrumentalities.  The Senate action puts us one step closer to repeal of the 3% withholding … Read More

IRS Releases New FAQs to Help Payers Understand the New Tax Reporting of Form 1099-K (I.R.C. Section 6050W)

IRS Releases New FAQs to Help Payers Understand the New Tax Reporting of Form 1099-K (I.R.C. Section 6050W)

The IRS has revised and updated the Frequently Asked Questions (FAQs) posted on the IRS website for payers who need to know about Form 1099-K reporting.  The updated FAQs are at http://www.irs.gov/newsroom/article/0,,id=249029,00.html. They cover developments as recent as the postponement of the start of backup withholding on Form 1099-K payables (to the beginning of 2013 instead … Read More

Self-Insurance Arrangements – Relief from IRC Section 6050W Requirements

Self-Insurance Arrangements – Relief from IRC Section 6050W Requirements

Notice 2011-78 provides relief to insurance companies administering certain self-insurance arrangements from information reporting obligations under Section 6050W of the Internal Revenue Code. Under the self-insurance circumstances identified in Notice 2011-78, an insurance company will not be treated as a third-party settlement organization with Form 1099-K reporting responsibility. Insurance companies may rely on the Notice until the Regulations … Read More

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IRC Section 6050W – Recent Developments

Relief Provisions and FAQs on IRC Section 6050W Payments The IRS is providing special transitional relief to banks and other payment settlement entities required to begin reporting payment card and third-party network transactions to the IRS on new Form 1099-K. By law, reporting is scheduled to begin in early 2012 for payment card and third-party … Read More

QIs Have No Choice with Regard to FATCA

QIs Have No Choice with Regard to FATCA

In last week’s EEI conference, it was announced that Qualified Intermediaries (QIs) will have no choice but to register to become a Participating Foreign Financial Institution (PFFI). This announcement came as quite a shock to some of the QIs that attended the Washington event, who assumed that they have the choice of becoming a non-participating … Read More

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Positive Future Changes for the W-8BEN

In last week’s EEI conference, Michael Danilack, Deputy Commissioner at the IRS, announced some positive changes for those having to collect and audit the W-8BEN. The term he used was “clearing the underbrush” which, in essence, means that the IRS is aware that they have been too strict on the validation rules of the W-8BEN in … Read More