Monday, August 16^th, final 6050W (reporting on payment card and third party network transaction) regulations were issued by the Internal Revenue Service.  These regulations are aimed at creating new reporting and withholding requirements for  financial institutions and service providers that settle card payments to merchants. 

The Tax Information Reporting Industry continues to see constant change in 1099 compliance rules and regulations- Corporate Reporting, Merchant Reporting, Cost Basis Reporting, Foreign Account Reporting, Potential Penalty Increases – to name just a few.

Having just participated in several recent industry conferences and shows, Convey is more aware than ever that the Tax Information Reporting Industry continues to see constant change in 1099 compliance rules and regulations- Corporate Reporting, Merchant Reporting, Cost Basis Reporting, Foreign Account Reporting (FATCA), Potential Penalty Increases – and the list goes on. 

Last week, Convey presented a webinar addressing the impact of the new tax information reporting changes on Accounts Payable departments due to recent changes to 1099 reporting introduced in the Healthcare reform bill in March (e.g. elimination of the Corporate exemption and reporting on payments of “goods” as well as services).  John Adams and Jeff Cronin, from Convey’s Product Management team, outlined the additional work effort around vendor master file clean up, how long the process will likely take, and what the penalties can be for non-compliance.  They also took the time to introduce Taxport A/P, the newest tax information reporting solution in the Convey family of services. Convey’s Tax Identity Management services and Taxport A/P have been designed specifically for Accounts Payable professionals to help them manage the increased vendor/supplier reporting. 

On March 23, 2010, President Barack Obama signed the healthcare legislation into law. Now that the law is done, we are left waiting for the final IRS regulations to define how we are going to comply. For our purposes, the changes we are most interested in surround the expansion of the information reporting program to include corporations and all goods and services.

As many of you may already know, Congress is currently reviewing legislation aimed at curbing tax evasion by U.S. citizens who use foreign institutions or create foreign investment or corporate structures to hide assets. 

One thing that we can say for certain is that the changes that we are seeing now are only the start of many more changes to come. The addition to new reporting requirements on corporations in order to shore up enforcement of taxes at the state and local level is only just now beginning to start, and the time to implement changes to support those requirements is getting shorter every day.

Will the IRS hold you liable for non-compliance? If your organization is not properly reporting Non-Resident Alien (i.e., non-U.S. citizen) income information, it could happen. Join Convey Compliance and Cyrus Daftary, a respected attorney and tax professional, on Monday, December 14, 1:00 p.m. Central Standard Time, for a 60-minute webinar to address this topic and surrounding issues.