Information Returns – Form 1099 Series, part 2

An Information Return is a tax form used to report to the federal government, non-payroll related payments made from a business, agency or person to another person or company. You also must furnish copies of the information returns to recipients for payments reported. Failure to file the information returns by specified due dates could result in huge penalties. This also applies to not providing copies of the forms to designated recipients. The IRS can increase penalties for failing to file or provide them all together. View our Information Returns Part 1 as well.

Form 1099-CAP, Changes in Corporate Control and Capital Structure

Form 1099-CAP is used to report to stakeholders the acquisition of controlling interest of a company of if is a company underwent a substantial change in the capital structure.  Often accompanies Form 8806, Information Return for Acquisition of Control or Substantial Change in Capital Structure.

File this form for each person which apply to any of the following:

  • shareholders who receive cash, stock, or other property from an acquisition of control or a substantial change in capital structure.

Corporations do not file Form 1099-CAP under one of the following conditions:

  • The transaction involves the acquisition of control within an affiliated group or involves stock valued at less than $100 million.
  • The corporation makes the consent election on Form 8806. Under the election, the corporation is not required to file Form 1099-CAP with respect to shares held by a clearing organization because it allows the IRS to publish information necessary for brokers to meet their reporting obligations.
  • The corporation properly reports the transaction under section 6043(a).
  • Information returns are filed under section 6042 (Form 1099-DIV) or section 6045 (Form 1099-B) unless the corporation knows or has reason to know that such returns were not filed.

Form 1099-G, Certain Government Payments

Form 1099-G is used to report certain payments by Federal, state, or local governments.

File this form for each entity who made payments of:

  • unemployment compensation;
  • state or local income tax refunds, credits, or offsets;
  • reemployment trade adjustment assistance (RTAA) payments;
  • taxable grants; or
  • agricultural payments.

They also file this form if they received payments on a Commodity Credit Corporation (CCC) loan.

Certain amounts that are not reportable on Form 1099-G, such as compensation for services, prizes, and certain incentives, may be reportable on Form 1099-MISC, Miscellaneous Income.

Form 1099-H, Health Coverage Tax Credit (HCTC) Advance Payments

Form 1099-H is used to report any advance payments received during the calendar year of qualified health insurance payments for the benefit of eligible trade adjustment assistance (TAA), Alternative TAA, Reemployment TAA, or Pension Benefit Guaranty Corporation (PBGC) pension recipients and their qualifying family members.

File this form if:

  • you are a provider of qualified health insurance coverage (defined in section 35(e)) and you receive advance payments from the Department of the Treasury on behalf of eligible recipients pursuant to section 7527, you must file Forms 1099-H to report those advance payments. You must also furnish a statement reporting that information to the eligible recipient.

Form 1099-K, Payment Card and Third Party Network Transactions

Form 1099-K is used to report payment transactions a payment settlement entity (PSE) processed for retailers.

You should receive this form if, in the prior calendar year, you received payments:

  • from payment card transactions (e.g., debit, credit or stored-value cards), and/or
  • in settlement of third-party payment network transactions above the minimum reporting thresholds of –
    • gross payments that exceed $20,000, AND
    • more than 200 such transactions

Form 1099-LTC, Long-Term Care and Accelerated Death Benefits

File Form 1099-LTC if you pay any long-term care benefits, including accelerated death benefits. Payers include insurance companies, governmental units, and viatical settlement providers.

Long-Term Care Benefits “Long-term care benefits” means:

  1. Any payments made under a product that is advertised, marketed, or offered as long-term care insurance (whether qualified or not); and
  2. Accelerated death benefits (excludable in whole or in part from gross income under section 101(g)) paid under a life insurance contract or paid by a viatical settlement provider.

Form 1099-OID, Original Issue Discount

File Form OID :

  • if the original issue discount (OID) includible in gross income is at least $10, or
  • for any person for whom you withheld and paid any foreign tax on OID, or
  • from whom you withheld (and did not refund) any federal income tax under the backup withholding rules even if the amount of the OID is less than $10.

Report interest that is taxable OID in box 1 or 8 of Form 1099-OID, Original Issue Discount, not on Form 1099-INT. Report interest that is tax-exempt OID in box 11 of Form 1099-OID, not on Form 1099-INT.

BoomTax, The Boom Post, and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors prior to engaging in any transaction.

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