Understanding Information Returns – Comprehensive Guide 2024

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.

Contents show

Common Information Returns

Form W-2G, Certain Gambling Winnings

This type of information return, Form W-2G, is used to report gambling winnings and any federal income tax withheld on those winnings. The requirements for reporting and withholding depend on:

  • the type of gambling,
  • the amount of the gambling winnings, and
  • generally the ratio of the winnings to the wager.

Form 1097-BTC, Bond Tax Credit

Screenshot of IRS Form 1097-BTC (Rev. December 2019)
Image of IRS Form 1097-BTC, Bond Tax Credit – Copy A (Rev. December 2019)

This type of information return is used to report issuers or agents of certain tax credit bonds and recipients of Form 1097-BTC from the bond issuer or agent, such as mutual funds or partnerships, who are further distributing the credit. A form must be filed for each tax credit distributed from the following tax credit bonds:

  • Qualified energy conservation bonds
  • New clean renewable energy bonds
  • Qualified zone academy bonds
  • Clean renewable energy bonds
  • Build America bonds (Tax Credit)
  • Qualified school construction bonds

Form 1098, Mortgage Interest Statement

Screenshot of Form 1098, Rev Jan 2022
Image of Form 1098, Mortgage Interest Statement – Copy A (Rev Jan 2022)

This type of information return, Form 1098, is used to report mortgage interest amounts of $600 or more received from an individual during the year during the course of business with an individual. A separate Form 1098 should be filed for each mortgage, and the $600 threshold applies separately for each mortgage.

Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes

Screenshot of IRS Form 1098-C
Image of Form 1099-C, Contributions of Motor Vehicles, Boats, and Airplanes – Copy A

This type of information return, Form 1098-C, is used to report a done organization who made contributions of a qualified vehicle that has a claimed value of more than $500. A qualified vehicle is:

  • any motor vehicle manufactured primarily for use on public streets, roads, and highways;
  • a boat; or
  • an airplane.

Form 1098-E, Student Loan Interest Statement

This type of information return, Form 1098-E, is used to report student loan interest received of $600 or more from an individual during the year in the course of your trade or business. This includes financial institutions, governmental units (or any of its subsidiary agencies), educational institutions, or any other person who receives student loan interest of $600 or more from an individual during the year.

The $600 threshold applies to each borrower regardless of the number of student loans obtained by that borrower. However, you may file a separate Form 1098-E for each student loan of the borrower, or you may file one Form 1098-E for the interest from all student loans of the borrower.

If more than one person has a connection with the loan, only the first person to receive the interest payment must file Form 1098-E. For example, a loan service or collection agent receiving payments on behalf of the lender must file.

Form 1098-F, Fines, Penalties, and Other Amounts

This type of information return, Form 1098-F, is used by government officials or governmental entities (including nongovernmental entities that are treated as governmental entities). It is used to report the amount required to be paid of fines, penalties and other amounts.

Form 1098-Q, Qualifying Longevity Annuity Contract Information

This type of information return, Form 1098-Q, is used to report any contracts issued that is intended to be a qualifying longevity annuity contract (QLAC).

A QLAC is an annuity contract that is purchased from an insurance company for an employee under any plan, annuity, or account described in section 401(a), 403(a), 403(b), or 408 (other than a Roth IRA) or eligible governmental plan under section 457(b), and that satisfies each of the following requirements:

  • Premiums for the contract satisfy the dollar limitation, as applicable.
  • Distributions must commence no later than the first day of the month after the employee’s 85th birthday.
  • The contract provides that, after distributions under the contract begin, those distributions must satisfy the requirements of Regulations section 1.401(a)(9)-6 (other than the requirement that annuity payments commence on or before the required beginning date).
  • The contract does not make available any commutation benefit, cash surrender right, or other similar feature (other than a right to rescind the contract within a period not exceeding 90 days from the date of purchase).
  • No benefits are provided under the contract after the death of the employee other than the benefits described in paragraph (c) of Regulations section 1.401(a)(9)-6 (Q&A-17).
  • Issued contracts (or a rider or endorsement with respect to that contract) states that the contract intends to be a QLAC.
  • The contract is not a variable contract under section 817, an indexed contract, or similar contract, except to the extent provided by the Commissioner.

An employee includes the owner of an IRA (other than a Roth IRA), where applicable.

Form 1098-T, Tuition Statement

This type of information return, Form 1098-T, is used by eligible educational institutions where a student was enrolled and for whom a reportable transaction is made. An eligible educational institution that is a governmental unit, or an agency or instrumentality of a governmental unit, is subject to the reporting requirements of Form 1098-T. A designated officer or employee of the governmental entity must satisfy the reporting requirements of Form 1098-T.

You are also required to file a Form 1098-T if:

  • You receive or collect payments of qualified tuition and related expenses on someone else’s behalf.
  • The person collecting on your behalf does not possess the information necessary to comply with the reporting requirements of Form 1098-T, then you must satisfy the reporting requirements of Form 1098-T.
  • You are an insurer engaged in a trade or business of making refunds or reimbursements of qualified tuition and related expenses.

Form 1099-A, Acquisitions or Abandonment of Secured Property

This type of information return, Form 1099-A, is filed for each borrower if you lend money in connection with your trade or business and, in full or partial satisfaction of the debt, you acquire an interest in property that is security for the debt, or you have reason to know that the property has been abandoned.

If, in the same calendar year, you cancel a debt of $600 or more in connection with a foreclosure or abandonment of secured property, it’s not necessary to file both Form 1099-A and 1099-C for the same debtor. Only file the Form 1099-C with boxes 4, 5, and 7 to meet the filing requirement.

Form 1099-B, Proceeds From broker and Barter Exchange Transactions

This type of information return, Form 1099-B, is used to report broker or barter exchange proceeds.

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

  • For who, the sold stocks, commodities, regulated futures contract, foreign currency contracts, forward contracts, debt instruments, options, securities futures contracts, etc., for cash
  • Who received cash, stock, or other property from a corporation that the broker knows or has reason to know had its stock acquired in an acquisition of control or had a substantial change in capital structure reportable on Form 8806. or
  • Who exchanged property or services through a barter exchange.

Form 1099-C, Cancellation of Debt

Screenshot of Form 1099-C
Image of Form 1099-C, Cancellation of Debt – Copy A

This type of information return, Form 1099-C, is used to report a cancellation of a debt. File this form for each debtor for whom you canceled $600 or more of a debt owed to you if:

  • you are an applicable financial entity, and
  • an identifiable event has occurred.

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

This type of information return, Form 1099-CAP, is used to report shareholders of a corporation if control of the corporation was acquired or it underwent a substantial change in 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-DIV, Dividends and Distributions

Image of Form 1099-DIV
Image of Form 1099-DIV, Dividends and Distributions – Copy A

Banks and other financial institutions use this information return form to report the dividends and other distributions to taxpayers and to the IRS.

File Form 1099-DIV for each person which apply to any of the following:

  • dividends were paid to (including capital gain dividends and exempt-interest dividends) and other distributions on stock if $10 or more.
  • where you withheld and paid any foreign tax on dividends and other distributions on stock.
  • where you withheld any federal income tax on dividends under the backup withholding rules, or
  • Anyone you paid $600 or more as part of a liquidation.

Form 1099-G, Certain Government Payments

This type of information return, 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

This type of information return, 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-INT, Interest Income

IRS Form 1099-INT Copy A red copy
Image of Form 1099-INT, Interest Income – Copy A

This type of information return, Form 1099-INT, is used to report interest payments made in the course of a trade or business by a nominee/middleman including federal, state, and local government agencies and activities deemed nonprofit.

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

  • Anyone you paid amounts reportable in boxes 1, 3, or 8 of at least $10 (or at least $600 of interest paid in the course of your trade or business)
  • where you withheld and paid any foreign tax on interest, or
  • where you withheld (and did not refund) and federal income tax under the backup withholding rules regardless of the amount of the payment.

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

Screenshot of Form 1099-K
Image of Form 1099-K, Payment Card and Third Party Network Transactions – Copy A

This type of information return, Form 1099-K, is used to report payment transactions a payment settlement entity (PSE) processed for retailers.

Payment settlement entities (PSE) must file Form 1099-K for any payee that exceeds the minimum threshold of $600 in aggregate payments, regardless of the number of transactions.

Form 1099-LS, Reportable Life Insurance Sale

This type of information return, Form 1099-LS, is used by the acquirer of any interest from a life insurance contract in a reportable policy sale.

  • Reportable Sale: Any direct or indirect acquisition of any interest in a life insurance contract if the acquirer, at the time, has no substantial family, business or financial relationship with the person insured, apart from the acquirers interest.
  • Acquirer: Any person that acquires an interest in a life insurance contract (either direct or indirect) in a reportable policy sale.

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-MISC, Miscellaneous Income

IRS Form 1099-MISC Copy A
Image of Form 1099-MISC, Miscellaneous Income – Copy A

This type of information return, Form 1099-MISC, is used to report various types of miscellaneous income.

If during the course of trade or business, the business made any of the following types of payments, then they should complete a Form 1099-MISC filing.

  • At least $10 in royalties
  • At least $600 in
    • Rents
    • Prizes and awards
    • Other income payments
    • Cash paid from a notional principal contract to an individual, partnership, or estate
    • Fishing boat proceeds
    • Medical and health care payments
    • Crop insurance proceeds
    • Gross proceeds paid to an attorney
    • Section 409A deferrals
    • Nonqualified deferred compensation

Form 1099-NEC or 1099-MISC can be used to report sales totaling $5,000 or more of consumer products to a person on a buy-sell, deposit-commission, or other commission basis for resale.

Form 1099-NEC, Non Employee Compensation

Image of Form 1099-NEC
Image of Form 1099-NEC, Nonemployee Compensation

This type of information return, Form 1099-NEC, is used to report non-employee compensation amounts to the IRS. A non-employee is defined as a person or business who is not employed by your company, such as independent contractors, freelancers, or outsourcing companies.

Form 1099-NEC should be filed for each person:

  • To whom you have paid at least $600 during the course of business during the year for:
    • Services performed by someone who is not your employee (including parts and materials)
    • Payments to an attorney
  • From whom you have withheld any federal income tax under backup withholding rules, regardless of the amount of payment.

Form 1099-NEC or 1099-MISC can be used to report sales totaling $5,000 or more of consumer products to a person on a buy-sell, deposit-commission, or other commission basis for resale.

Form 1099-OID, Original Issue Discount

This type of information return, Form 1099-OID, is used to report original issue discounts (OID) of $10 or more. This form should be filed in the following situations.

  • If the original issue discount (OID) includible in gross income is at least $10.
  • For any person for whom you withheld and paid any foreign tax on OID.
  • 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.

Form 1099-PATR, Taxable Distributions Received from Cooperatives

This type of information return, Form 1099-PATR, is used to report taxable distributions received from cooperatives. Cooperatives file Form 1099-PATR for each person:

  • To whom the they paid at least $10 in patronage dividends and other distributions described in section 6044(b).
  • From whom they withheld any federal income tax under the backup withholding rules regardless of the amount of the payment.

Form 1099-Q, Payments from Qualified Education Programs (Under Sections 529 and 530)

This type of information return, Form 1099-Q (Info Copy Only), should be filed if you:

  • Are an officer or an employee, or the designee of an officer or employee, having control of a program established by a state or eligible educational institution.
  • Made a distribution from a qualified tuition program (QTP).

Form 1099-QA, Distributions from ABLE Accounts

This type of information return, Form 1099-QA, is used to report distributions from ABLE Accounts. Any state, or its agency or instrumentality, that operates a qualified ABLE program must submit this form to the IRS for each ABLE account that had a distribution or was closed.

Form 1099-R, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRS, Insurance Contract, etc.

Screenshot of IRS Form 1099-R
Image of IRS Form 1099-R, Distributions from Pensions, Annuities,
Retirement or Profit-Sharing Plans, IRS, Insurance Contract, etc. – Copy A

This type of information return, Form 1099-R, is used for reporting designated distributions of $10 or more of retirement benefits. Can also be used to report death benefit payments made by employers that are not made a part of a pension, profit-sharing, or retirement plan.

File this form for each person to whom you have paid distributions of the following during the year:

  • profit-sharing or retirement plans
  • any individual retirement arrangements (IRAs)
  • annuities, pensions, insurance contracts, survivor income benefit plans
  • permanent and total disability payments under the life insurance contracts
  • charitable gift annuities, etc.

Form 1099-S, Proceeds From Real Estate Transactions

This type of information return, Form 1099-S, is used to report the sale or exchange of real estate transactions that consists in whole or in part of the sale or exchange for money, indebtedness, property, or services of any present or future ownership interest.

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

  • Improved or unimproved land, including air space.
  • Inherently permanent structures, including any residential, commercial, or industrial building.
  • A condominium unit and its appurtenant fixtures and common elements, including land.
  • Stock in a cooperative housing corporation (as defined in section 216).
  • Any non-contingent interest in standing timber.

Form 1099-SA, Distributions from an HSA, Archer MSA, or Medicare Advantage MSA

This type of information return, Form 1099-SA, is used to report distributions made from Health Savings Accounts (HSA), Archer Medical Savings Accounts (Archer MSA), Medicare Advantage Medical Savings Account (MA MSA).

Distributions may have been made directly to medical service providers or to the account holder. Separate returns must be filed for each type of plan.

Form 1099-SB, Seller’s Investment in Life Insurance Contract

This type of information return, Form 1099-SB, is used by the issuer of a life insurance policy to report the seller’s investment in the contract and surrender

Form 3921, Exercise of an Incentive Stock Option Under Section 422(b)

This type of information return, Form 3921, is used by a corporation to report a transfer of stock to any person who exercised an incentive stock option described in section 422(b).

Form 3922, Transfer of Stock Acquired Through an Employee Stock Purchase Plan under Section 423(c)

This type of information return, Form 3922, is used for a corporation to report a transfer of the legal title of a share of stock. The employee must acquire the stock pursuant to the employee’s exercise of an option granted under an employee stock purchase plan. It must also be described in section 423(c) (where the exercise price is less than 100% of the value of the stock on the date of grant or is not fixed or determinable on the date of grant).

Form 5498, IRA Contribution Information

This type of information return, Form 5498, is used to report for each person for whom you maintained any individual retirement arrangement (IRA), including a deemed IRA under section 408(q).

Form 5498-ESA, Coverdell ESA Contribution Information

Form 5498-ESA is used to report for each person for whom you maintained any Coverdell education savings account (ESA).

A Coverdell ESA is a trust or custodial account created or organized in the United States. This trust is exclusively for the purpose of paying the qualified education expenses of an individual who is the designated beneficiary of the trust or custodial account. You must designate the account at the time of creation as a Coverdell ESA. If not, you must treat and organize it as a Coverdell ESA for tax purposes. The governing instrument creating the trust must meet the requirements of section 530(b)(1).

Form 5498-QA, ABLE Account Contribution Information

This type of information return, Form 5498-QA, is used to report contributions to ABLE accounts. Any state, or its agency or instrumentality, that established and manages a qualified ABLE program must file this form with the IRS for each ABLE account.

Form 5498-SA, HAS, Archer MSA, or Medicare Advantage MSA Information

This type of information return, Form 5498-SA, is used to report whom you maintained an HSA, Archer MSA, or MA MSA if you were a trustee or custodian of:

  • Health Savings Account (HSA),
  • Archer Medical Savings Account (Archer MSA), or
  • Medicare Advantage MSA (MA MSA)

The IRS requires a separate form for each type of plan.

Methods of Filing

Filers can paper file or electronically file their returns, but there are requirements that must be met for each method.

Filers may choose to paper file their 1096 and accompanying forms to the IRS if their total form count across all filings and filing types is less than the 10-form threshold. E-filing is encouraged by the IRS, but if you have less than 10 total forms to file, then paper filing is an option.

How is the mailable 10-form threshold calculated?

Filers must find the sum of the following form types to determine if they must electronically file:

  • Form 1042-S
  • Form 1094 series
  • Form 1095-B
  • Form 1095-C
  • Form 1097-BTC
  • Form 1098
  • Form 1098-C
  • Form 1098-E
  • Form 1098-Q
  • Form 1098-T
  • Form 1099 series
  • Form 3921
  • Form 3922
  • Form 5498 series
  • Form 8027
  • Forms W-2
  • Form W-2G

If a filer has 10 or more of these forms total, then they must submit electronic filings.

IRS Form Count Threshold
IRS Form Count Threshold Example

Conclusion

There are many different types of information returns, which are tax forms used to report certain information. These forms must be filed to the IRS, any applicable states, and furnished to the recipient by the applicable deadlines.

If you’d like to learn more about Form 1096, then take a look at our Essential Guide: Mastering Form 1096. Alternatively, you can download a PDF version of our 1096 guide below:

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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