The IRS has extended its pilot program under which filers of the Forms 1099 series of information returns may truncate the first five digits of payees’ Taxpayer Identification Numbers (TINs) on payees’ paper copies.
The pilot program will now run for calendar year 2011 and 2012 1099 forms, which are filed in 2012 and 2013, respectively. Important: TIN truncating doesn’t apply to Forms W-2/W-3. (Notice 2011-38, IRB 2011-20)
X (or *) marks the spot
TIN truncating applies only to the paper copies that payees receive. Forms filed with the IRS must contain payees’ full TINs, and payees who have consented to receive electronic forms must receive forms that contain their complete TINs.
TINs include Social Security Numbers, Individual Taxpayer Identification Numbers and adoption Taxpayer Identification Numbers.
Under the truncation procedure, the first five digits must be replaced with either asterisks or Xs: ***-**-1234 or XXX-XX-1234.
Care to comment? The IRS is interested in hearing from payers who truncated TINs on 2009 or 2010 forms or both. Comments are due by July 29, 2011, and may be emailed to Notice.Comments@irscounsel.treas.gov. Be sure to include the phrase “Notice 2011-38” in the subject line of your email.