1099 Issues

jroman24
  |     |   1 posts since 2021

I cashed in a NYCB CD that matured in September. When I went online to get my 1099 for the interest I received so I could report it on my tax return, my online access was no longer available. I called customer service and was told I would receive my 1099 by mail (online access was cancelled as soon as I cashed in the C/D!). I followed up around February 10 and was told they had until February 15 to mail out the 1099's. I still had not received it by February 25, so I called the local Ohio Savings branch (where I had originally opened the C/D). Upon checking, I was told I had to go into the branch and sign a form before they could give me my 1099. Is this even legal? Has this happened to anyone else? I think this has happened to me before, so once burned.....



Answers
alan1
  |     |   573 posts since 2015
You do not need to receive a Form 1099 with the interest amount in order "to report it" on your tax return. Unlike Form W-2 (Wage and Tax Statement), 1099s need not be filed along with your tax return.

You just need to report the amount of the interest on your return. Now, I guess there's a possibility that the payor will report an incorrect amount to the IRS (unlikely, but not impossible). Have you asked a bank representative to tell you how much interest they reported?

[end of answer to jroman24]

As to how I deal with such things (and I am not recommending that anyone do the same), I've never been bothered about missing 1099-INTs for CDs, and have never had a problem with it. The one area I'd be careful about is if I closed a CD before maturity and had a penalty imposed. I'd want to be certain that the payor got it right. Other than that, I wouldn't spend much time or effort getting a document that the IRS isn't asking me for.

But that's just me -- I certainly recognize that others are willing to expend the effort. To me, the possible detriment from not receiving the document before filing my return does not outweigh the two major principles of my approach to personal finance -- laziness and inertia.

But, in any case, you can report the interest on your return without having received the 1099.
blazer9
  |     |   135 posts since 2019
alan1 said, " I've never been bothered about missing 1099-INTs for CDs, and have never had a problem with it."

As we don't even have to submit 1099s electronically filing taxes, and for any record at all, We are forced to d/l them ourselves. Paper Reduction Act ..right ?
How do people deal with CU/ Bank "assumed" non-reported $10 and under interest income?
I have many accounts with just low dollars kept for activity requirements.
me1004
  |     |   1,035 posts since 2010
Actually, jroman24, I don't think the bank has the option to require you to go in and sign a form. They are requried by federal law to provide to you, end of discussion -- they just have to mail to your last known address. I can't imagine what that form will be about. But it is not your responsibility to jump through hoops, they are required to provide it no matter what, and if they closed out your online account when you closed the CD, that is their problem, they then cannot make you get it through your onoine account.

But that is the technicality. It would be harder to enforce it than simply signing whatever form they want. But also, try another call, and to a higher up, the CSR with whom you spoke doesn't necessarily know what they are talking about, even a branch manager doesn't necesarily know. And they can mail you that form, or e-mail it over.

Did they say they had mailed it and it was returned?

blazer9, re the 1099 for under $10.00. Yes, you are right, they do not have to report that, to you or the IRS. You are supposed to report it on your 1040 anyway, but no one knows, in particular the IRS, so I'm sure few people do that. But if they send one, I figure you better report it on your tax form.

I got one a couple years ago from a CU I'm in showing total interest for the year was 32¢! Oh, for god's sake, but because they sent the 1099, I reported it on my 1040. It cost them more in postage to send that than it amounted to!

his past year, I got around $4 in interest from the IRS, but no 1099. Now, the IRS already knows they paid that, I figure I better list it on my 1040 that I file in about a month, even with no 1099. I'm presuming the IRS is not required to send a 1099 form, but they still expect that to be reported on my 1040.
alan1
  |     |   573 posts since 2015
I am not aware of any legal requirement re Form 1099-INT that banks "have to mail to your last known address." Numerous banks and credit unions do not mail out Form 1099-INT -- they make it available online, and that's it.

I've never looked into it, so I don't claim to know whether those institutions are violating some law or regulation. I tend to doubt it, but I don't actually know.
Choice
  |     |   318 posts since 2020
I’ve been advised by a CU a couple of years ago after all forms submitted/received that it neglected to include some interest from a mid year closed CD. I did not file any amended return but questioned their controls/practices. Don’t forget you could get a SAR filed by them if you push it!
me1004
  |     |   1,035 posts since 2010
alan1, technically you are right, I should have stated that better. They must provide you the 1099. Yes, they can do so online, but in this case, they are the ones who chose to eliminate that possibility when jroman24 closed the CD. I closed an account with a financial institution in November, and they still have my online access available to me specificially so I can get my 1099 there, they don't want to mail it. jroman24's bank could do the same, but has chosen not to. So, they have to provide it another way, presumably by mail. It is the burden of providing it that is on the bank, not on jroman24 to have to chase it around, fill out forms, go to branch. If he doesn't do any fo that and they don't provide it, they have broken the law because they did not provide it.

Why does jroman24 have to fill out a form and apparently in person?! That's nonsense.

Choice, I fully undestand the burden that change in the 1099 imposes. Still, you must file that income and pay tax on it. IRS generally waits at least two years after the filing to do audits. If they see you did not file some income, you might get an audit -- although they might give you a break because they will see your 1099 was changed - - but they will still send you a bill, and add interest due on it between the due date of that tax year and when they bill you. You don't want to have to deal with an audit, even if you do everything perfectly, it is a monstrous thing to go through, digging out all kinds of backup paperwork and bookkeeping.

I had a change from a mutual fund in early March one year, and I had to completely re-do my taxes because of that.
Choice
  |     |   318 posts since 2020
me1004... my amount was very small...one reason why I leave $x with irs...interest rates are so low...no harm, no foul! Offset if they want! If they spend time on me, they have less time for/on you!
Robb
  |     |   80 posts since 2018
I've never had a problem getting my 1099 info over the phone after going through some security prompts at various institutions. I typically confirm the amount quoted against my Y/E December statements which typically show interest YTD.

Another area of concern I have found is what has occurred to me each of the past 2 years. Receiving a 1099-INT for my traditional IRA. Took a lot of work to get those corrected in both instances. Good luck!
Choice
  |     |   318 posts since 2020
In the past I asked for a proforma 1099 before going thru with the contemplated transaction, ie a 403b annuity early surrender which was negotiated to be a no cost transfer to an ira
ORInvestor
  |     |   32 posts since 2014
The Enrichment Federal Credit Union has not issued any 1099s since I joined. They say that the information is on the December statements.
Choice
  |     |   318 posts since 2020
Thus, ask what they are sending to irs? Ask to have them send u a copy of that which went to irs...should be some form of 1099.


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