1099Fire

When you first log into the IRS FIRE system, you create a password and PIN (personal identification number). The password is something you create and must be 8 alpha/numerics, containing at least 1 uppercase, 1 lowercase and 1 numeric.

If you forget your password or PIN, you can call IRS/ECC-MTB toll-free at 1-866-455-7438 for assistance to creating a new password and/or PIN.

The FIRE system periodically requires users to change their password (usually once a year).

The Amount Codes used in the “A” Record MUST correspond with the payment amount fields used in the “B” Records. For example, if the “B” Records show payment amounts in Payment Amount fields 2, 4 and 7, then the “A” record must correspond with 2, 4, and 7 in the Amount Codes field.

For Form 1099-R, there must be valid Distribution Code(s) in positions 545-546 of the Payee “B” Record. The 1099FIRE software has a list of valid codes (and combinations). If only one distribution code is required, it must be entered in position 545 and position 546 must be blank. A blank in position 545 is not acceptable.

Entered TINS must consist of nine numerics only.

This error should not arise in the 1099FIRE software. The software will double check that each TIN is comprised of nine digits only. Two common errors that are often caught during the review of a file are (1) that the uppercase letter O is used instead of a 0 (zero) and (2) that the lower case letter l is used instead of the number 1.

When sending a test file, position 28 of the Transmitter “T” record must contain a “T”. Do not populate this field with a “T” if sending an original, replacement or correction field.

When you log into the IRS FIRE system, you will be asked whether you are submitting an original, replacement, correction or test file. If you select correction, then the 1099 software also has to identify the file as a correction, otherwise you will receive this error.

The software will identify a Payee “B” record as a correction when you put a check in the box “Corrected” at the top of the form.

The “C” Record is a summary record for a type of return for a given payer. IRS compares the total number of payees and payment amounts in the “B” records with totals in the “C” Records. The two totals must agree.

Do NOT enter negative amounts except when reporting Forms 1099-B or 1099-Q. Money amounts must be all numeric, right-justified and zero(0) fill unused positions. Do not use blanks.

The Hiring Incentives to Restore Employment (HIRE) Act exempts employers from the employer’s share of social security tax (referred to as the payroll tax exemption) on wages paid to qualified employees from March 19, 2010, through December 31, 2010. For employers to report the amount of wages and tips covered by the payroll tax exemption, we added a new code for box 12, Code CC, for HIRE exempt wages and tips. The total of code CC is reported in new box 12b on Form W-3. The total of deferred compensation amounts, previously reported in box 12, is now reported in new box 12a on Form W-3.

Employers will be required to report on annual Forms W-2 the aggregate cost of group health plan benefits (excluding FSA, HSA, or Archer MSA contributions, or the cost of long term care, and certain other excepted benefits) provided to employees for taxable years beginning on or after January 1, 2011 (i.e., Forms W-2 issued in 2012 for 2011 wages, and issued thereafter for subsequent years).

We are waiting for IRS guidance on some of the language in the bill. Further details will be made available as we get further clarification from the IRS.