Monday, November 30, 2009
The IRS also announced plans for a public hearing on the new reporting requirements: Feb. 20, 2010, beginning 10:00 a.m. EST, at IRS headquarters in Washington, DC.
The new IRS reporting requirements, slated to take effect Jan. 1, 2010, were imposed under the Housing and Economic Recovery Act of 2008. Acquirers and other companies that provide payment card settlement services for merchants are required under Section 6050W of that law to complete and file annual information reports with the IRS detailing gross annual transaction totals by merchants.
The reports, known as 1099-Ks, look a lot like other familiar IRS 1099 forms (such as those the banks use to report deposit interest payments) and, for the most part, follow the rules for other 1099 reports (for example, copies go to both the IRS and payees). In addition to yearly totals, however, the proposed new Form 1099-K requests monthly breakouts of merchants' gross card payment receipts.
The first round of reports, covering gross card receipts for calendar year 2010, will need to be filed with the IRS in early 2011. According to the draft rules, only merchants with payments exceeding in the aggregate $20,000 and 200 transactions are covered by the rule.
Copies of the draft rule are available from the IRS at www.irs.gov/pub/irs-news/reg-139255-08.pdf .
The Green Sheet Inc. is now a proud affiliate of Bankcard Life, a premier community that provides industry-leading training and resources for payment professionals. Click here for more information.
Notice to readers: These are archived articles. Contact names or information may be out of date. We regret any inconvenience.