News - September, 2011

Steve Hughes
Service Bureau Manager
Email Steve Hughes

Information Return Penalties Have Increased Significantly!

Nature of Changes for the Current Year (Tax Year 2011)

IRS Penalties associated with Information Return filing have increased significantly.

Please see Part A, Sec.11.02 of IRS Revenue Procedure 2011-40 for specific information.

Here is listing of of Form Changes:

1098-T
Half-time Student Indicator and Graduate Student Indicators are now Required fields.

1099-B
Added Cost or other basis and Wash sale loss disallowed.
Deleted Number of shares exchanged
Deleted Class of stock exchanged
Added Non-covered security indicator
Allowable characters are 1 for Noncovered security and blank
Added Type of gain or loss indicator, Allowable characters are 1 for Short term, 2 for Long term and blank.
Added Date of Acquisition.

New Form 1099-K, Merchant Card and Third Party Network Payments
Gross amount of merchant card/third party network payments
January-December payments
Type of Filer Indicator
Number of Transactions
Payment Settlement Entity's Name,
Merchant Category Code

1097-BTC has numerous changes
Other Allowance Date Credit
Many Indicator Fields had description changes. The following fields were added: Other Allowance. Identification Number, March Allowance Identification Number, June
Allowance Identification Number, September Allowance Identification Number, December Allowance Identification Number.
The following fields were deleted: Bond issue date, CUSIP number, Maturity Date, Bond Code, Bond Issuer's identification number, and Bond issuer's name.

1099-R
Renumbering of Boxes
Amount Allocable to IRR within 5 years
Deleted distribution code D, Excess contributions plus earnings/excess deferrals taxable in 2008.

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