No SS # for contractor

[Kram BergGold]

My client does 1099 forms for her subs. She does not have a social for one of them. I assume I just prepare that 1099 without the SS #. Does my client get fined for this?

[KJ Judd]

I would give her a Form W-9 and ask her to get it completed by the contractor. I just had a discussion today with a client that if you require the completed Form W-9 before you pay they are much more responsive. Just say it is your policy.

[JG EA]

So, in theory you get the W-9 first, if they are unresponsive you withhold as per the 1099 instructions.

But, that being said I've filed ones without the number before.

[John of PA]

send to IRS without the SS#

If you can't get the SS#, send it in to IRS without the SS# and inform your client that they probably will be getting a penalty from IRS ($ 50.00 per 1099, I think!).

[DixieEA]

correct social security #

How about if you suspect the # provided by payee is not a correct #, and the payor has not
had a W-9 form completed by payee. Do you still file the 1099 with that #?

Thanks, DixieEA

[Black Bart]

No.

My client does 1099 forms for her subs. She does not have a social for one of them. I assume I just prepare that 1099 without the SS #. Does my client get fined for this?

I've sent in many W2s without a SSN over the years and my clients have never been fined for no numbers. Doing a big payroll, there's always a couple they don't get a number for. What does happen sometimes is that, usually a year or two later, the Social Security Administration (not IRS) will send you a letter asking for that number and you can write back and tell them he/she was a transient worker who promised to bring you the number but never did. Then you won't hear anything else from them. That's been my experience, although I don't know if it varies by IRS district or not (some things seem to). We've been with, variously, Memphis, Austin, and (currently) Kansas City.

Now; what IRS does fine you for (usually -- not always) is late filing. At $50 a pop on 30-40 subcontractors, it really stings. Get hit with that and subsequently you'll be very careful about advising clients to keep close track of the approaching February 28th. Note that if you write a lengthy and sufficiently remorseful excuse/apology and promise to never do it again, then odds are good (about 65-70%) you'll be excused from the penalty.

[Black Bart]

Yes.

How about if you suspect the # provided by payee is not a correct #, and the payor has not had a W-9 form completed by payee. Do you still file the 1099 with that #?

Sooner or (usually) later, IRS will get around to sending your client a notice about the mismatch -- requesting a W-9 and to begin backup withholding if the guy won't come across with a good number.

I once had a client who got a phony number from a con artist (he plucked it out of the air) and when she sent him a W-9, he promptly made up another one and gave to her. After phony #2, IRS wrote (this took months) and instructed her to begin backup withholding of (what is it -- thirty something percent?). She told the sub she was holding that much out of his next check and he hit the road. She hasn't seen him since, but IRS never fined her anything for not getting the correct number.

[Kram BergGold]

Thanks Black Bart

Your comments were just what I was looking for.

[John of PA]

Ty

BB, TY for your excellent carifications in this post.