We have a customer that is questioning why only his name is used to report the interest earned on the 1099int form...the certificate he earned interest on is in both he and his wife's names. He wants proof in black and white as to why only one person's SS# is used to report the interest earned. I have searched the IRS 1099 instructions and the W9 form and cannot find anything in black and white to appease him...any suggestions?? Thanks in advance!

I think it's because the 1099-INT must reflect the TIN owner's name, and
her name is not on his TIN (does that make sense?)
I don't know of any regulation, but if you research almost any CRM/CIF system,
they can only tax-select one party. I never saw a system that would generate
a 1099-INT with two names on it. And maybe somewhere on your signature card
he agreed to be the tax select party.

I would just ask him a few questions:

1. Does he file jointly with his wife?
If yes, then ask him what his problem is, it doesn't make a difference to IRS.

2.If no, then why doesn't he close that account and put it in his wife's name first, then his.
She can be the Tax-select party.

or:
3.How about splitting the account and opening two individual accounts (then
he can have 2 1099ints (yippee, more paperwork).

Good luck!

I know I’m not going to be much help… the IRS wants only one SSN. Banks generally use the first name and SSN to report. If he wants his wife to get the 1099, then have her name/SSN listed first. I know this is a little cold – tell him to seek advice from a tax consultant.

Slightly off topic, I have heard of customers wanting a “split” 1099 – no such thing (that we could find) exists. Besides, we would not want to do such because the bank would not want to keep up with “who gets what %”.

Hopefully someone else will give you better suggestions.

Thanks for the ideas, however we have informed him of most of these...he wants to see something in "black & white"...I think that I will ask him to contact his tax consultant. I just wanted be to certain that there wasn't a banking reg that had this info to back our answers. Thanks again!!

This gentleman sounds like he doesn't have enough to do so
he thinks about things like this.
One day maybe I to will be that lucky.

From the IRS 2002 Instructions for Form 1098:

"Payer of Record
"The payer of record is the individual carried on your books and records as the principal borrower. If your books and records do not indicate which borrower is the principal borrower, you must designate one.
"Multiple Borrowers.
"Even though there may be more than one borrower on the mortgage, you are required to prepare Form 1098 only for the payer of record, and only if such payer of record is an individual, showing the total interest received on the mortgage. Even if an individual is a coborrower, no Form 1098 is required unless the payer of record is also an individual."

Now I recognize that these instructions are not for the form you want, but I would be surprised if the instructions for Form 1099 differed in this respect.

Look at the following link for instructions for Forms 1099, 1098, 5498, and W-2G.

Instructions for Forms 1099 etc

Look on page GEN-8 at the bottom under "Recipient Names and Tax Identification Numbers." The instructions say, "Show the full name and address in the section provided on the information return. If payments have been made to more than one recipient or the account is in more than one name, show on the first name line the name of the recipient whose TIN is first shown on the return. "

Hope this helps

If the person under whose name the IRS reporting is done dies the IRS will eventually catch on and inform the surviving spouse or others that they have been getting 1099s in the name of the deceased and that needs to be changed. I saw one --- a surviving bank employee got one on her personal account with her eceased husband. The IRS does not require banks to keep track of every customer to make sure they are still alive. The IRS is not going to penalize the bank for not changing the reported TIN to the survivor unless the bank was part of the scheme to not report under the tin of the survivor.

People are amazing. Getting a 1099 doesn't mean taxes are due. Likewise, not getting a TIN doesn't mean taxes don't have to be paid. If the survivor gets the interest income and doesn't report it as the 1099 name/TIN was in the name of a dead person, they've just engaged in tax evasion. Which opens another interesting question. If the survivor says they don't want to change the name/TIN is that suspicious activity triggering a SAR? My answer is no but I can see the day coming where we will be required to report any tas trickery we discover.

So - you should change the reporting on the account so the survivor gets the 1099 right? Then it's up to the survivor to determine how much tax to pay on their portion and report the rest on the deceased person's tax return?