What is TIN Matching
TIN matching is a service implemented by the IRS that allows a 1099 filer to check the TIN (Taxpayer Identification Number) and a specific name to ensure that there is a match for it in the IRS database. This process helps filers avoid IRS penalties and B-Notices for missing TINs or incorrect Name/TIN combinations.
The IRS created TIN matching to increase compliance and to reduce the costs associated with sending notices and the additional processing.
Note: TIN Matching is currently only available for 1099 forms. TIN Matching is not consistent with W-2 or 1095 filing results.
What does TIN matching do?
The purpose of the TIN matching service is to provide a list of errors (not corrections) that the IRS finds in the records submitted. The TIN matching service does not, in any way, modify any data within your Yearli program.
You will need to read the report once available, verify the information with your recipients, and manually make any necessary changes to records prior to submitting forms.
Submitting a Payer for TIN Matching
The TIN Matching feature is available, free of charge, to users of the Yearli Desktop software via the E-file Center.
Only recipients with valid TINs can be submitted for TIN Matching with the IRS. Any recipients with blank TINs, TINs containing the same repeating digit (111111111), or TINs with 123456789 will not be sent.
- In Yearli Desktop verify all payer and recipient data has been entered, including names, social security numbers, and EINs.
- Click on the E-file Center menu.
- If an E-file Center account has not been created, choose Account Setup to create the account.
- After an account has been setup, choose TIN Matching.
- Choose the payers from the list that you wish to submit for TIN Matching. All payers will be selected by default.
- Click Submit.
The IRS can return the TIN Matching results in as fast as 24 hours; however, it may take up to three business days.
Viewing TIN Matching results
Once the IRS completes the TIN Matching process, the results will be available in the E-File Center to view.
- Click on the E-file Center menu.
- Choose TIN Matching.
- Choose View TIN Matching Status.
- At the status window, select the Order Numbers that you want to view the TIN Matching results for.
- Click on the Order Status Detail button.
- The report will open for viewing or printing.
TIN Matching status:
- Invoice Paid – The batch process has been started.
- Filing In Process – The batch data is under review with the IRS.
- Filing Complete – The results have been returned from the IRS and Yearli is posting the results for each recipient.
- Results Available – Yearli has completed processing the results and they are ready for viewing.
How to read the TIN matching results
The TIN matching codes and descriptions are shown below. For more information, please see the IRS TIN matching publication.
| TIN Matching Code | DESCRIPTION |
|---|---|
| IRS Code 1 | TIN is missing or not a 9 digit number. |
| IRS Code 2 | TIN is not in the IRS records. |
| IRS Code 3 | Name/TIN combination does not match IRS records. |
| IRS Code 4 | Invalid TIN Matching request. |
| IRS Code 5 | Duplicate TIN Matching request. |
| IRS Code 6 | Name/TIN combination matched IRS records as a SSN. |
| IRS Code 7 | Name/TIN combination matched IRS records as an EIN. |
| IRS Code 8 | Name/TIN combination matched IRS records as an EIN and SSN. |
| IRS Code 0 | Name/TIN combination matches IRS records. |
| IRS Code 111 | IRS did not return a result. |
| Unable to Submit - Name has been submitted for multiple TINs. | The same recipient name was submitted for multiple, different TINs. Verify the data and resubmit. |
| Unable to Submit - TIN has been submitted for multiple names. | The same recipient TIN was submitted for multiple, different names. Verify the data and resubmit |
Penalties
Penalties are imposed for each of the following infractions related to information returns:
- Filed with missing/incorrect information
- Filed untimely
- Filed with an incorrect TIN
- Failure to report a recipient's TIN
- Filed in an incorrect format
- Any combination of the above
For returns filed before January 1, 2016, Internal Revenue Code (IRC) section 6721 imposes a:
- $30 per information return if you correctly file within 30 days of the due date
- $60 per information return if you correctly file more than 30 days after the due date but by August 1
- $100 per information return if you file after August 1 or you do not file required information returns
Maximum penalties to payers for failure to file correct information returns, including furnishing an incorrect name/TIN to IRS = $1.5 million/year ($500,000 for small businesses); $250/return for intentional disregard with no maximum penalty.
For returns filed beginning January 1, 2016, Internal Revenue Code (IRC) section 6721 imposes a:
- $50 per information return if you correctly file within 30 days of the due date
- $100 per information return if you correctly file more than 30 days after the due date but by August 1
- $250 per information return if you file after August 1 or you do not file required information returns
Maximum penalties to payers for failure to file correct information returns, including furnishing an incorrect name/TIN to IRS = $3 million/year ($1 million for small businesses); $500/return for intentional disregard with no maximum penalty.
Notices
If the IRS sends you a CP2100 or CP2100A Notice indicating an incorrect recipient TIN/name combination, you are required to send the "B" Notice within 15 days from the date you received it, or the date of the CP2100/2100A, whichever is later. See Publication 1281 for details.
- CP2100 or CP2100A: "Notice of Possible Payee TIN Discrepancy" - Notice sent from IRS to the payer listing name/TIN combinations on information returns that do not match IRS records.
- B Notice: "Backup Withholding Notice" - Notice sent from payer to recipient requesting correct name/TIN. There are two B notices - a First B Notice and a Second B Notice. The text on the two notices is different.
- Notice 972CG: "Proposed Penalty Notice" - Notice sent from IRS to the payer notifying the payer of potential penalties. Payers have 45 days to respond to abate proposed penalties.
- CP15/215: "Balance Due Notice" - A bill from IRS to the payer informing the payer of the amount of penalties due.