Rev. Proc. 82-47

                              CONTENTS

SECTION 1. PURPOSE

.01 The purpose of this revenue procedure is to provide the requirements and conditions for filing information returns in the Forms 1099 and 1087 series, on magnetic tape instead of paper returns. Specifications for filing the following forms are contained in this procedure:

a) Form 1099R, Statement for Recipients of Total Distributions from Profit-Sharing, Retirement Plans, and Individual Retirement Plans, and Individual Retirement Arrangements.

b) Form 1099-DIV, Statement for Recipients of Dividends and Distributions.

c) Form 1099-INT, Statement for Recipients of Interest Income.

d) Form 1099-MISC, Statement for Recipients of Miscellaneous Income.

e) Form 1099-MED, Statement for Recipients of Medical and Health Care Payments.

f) Form 1099-OID, Statement for Recipients of Original Issue Discount.

g) Form 1099-PATR, Statement for Recipients (Patrons) of Taxable Distributions received from Cooperatives.

h) Form 1099L, U.S. Information Return for Distribution in Liquidation During Calendar year.

i) Form 1099-NEC, Statement for Recipients of Nonemployee Compensation.

j) Form 1099-UC, Statement for Recipients of Unemployment Compensation Payments.

k) Form 1099-ASC, Statement for Recipients of Interest on All-Savers Certificates.

l) Form 1087-DIV, Statement for Recipients of Dividends and Distributions.

m) Form 1087-INT, Statement for Recipients of Interest Income.

n) Form 1087-MISC, Statement for Recipients of Miscellaneous Income.

o) Form 1087-MED, Statement for Recipients of Medical and Health Care Payments.

p) Form 1087-OID, Statement for Recipients of Original Issue Discount.

q) Form 1087-ASC, Statement for Recipients of Interest on All-Savers Certificates.

r) Agriculture Subsidy Payment Report.

.02 This procedure also provides the requirements and specifications for magnetic tape filing under the Combined Federal/State Filing Program.

.03 This procedure supersedes Rev. Proc. 81-34.

SEC. 2. NATURE OF CHANGES

.01 There are various editorial changes.

.02 Record layouts have been added.

.03 All references to "D" Records have been deleted.

.04 Changes have been made to the amounts reportable for Forms 1099-INT, 1099-PATR, and 1087-INT.

SEC. 3. WAGE AND PENSION INFORMATION

.01 Section 8(b), Pub. L. 94-202, 1976-1 C.B. 503, enacted in January 1976, authorized the combined reporting of FICA detailed information (previously reported quarterly on Form 941, Schedule A and Annual W-2 (Copy A), Wage and Tax Statement) in one consolidated annual W-2 (Copy A) to the Federal Government. As a result, Forms W-2 and W-2P are to be filed with the Social Security Administration (SSA).

.02 SSA will accept magnetic media filing of Forms W-2 and W-2P and has issued TIB-4a, Magnetic Tape Reporting, Submitting Wage and Tax data to Federal and State Agencies, TIB-4b, Magnetic Tape Reporting, Submitting Annuity, Pension, Retired Pay or IRA Payment to the Federal Government on Magnetic Tape, and TIB-4c, Diskette and Disk Cartridge Reporting, Submitting Wage and Tax Data to the Federal Government on Diskette and Disk Cartridge, for this purpose. Applications for filing Forms W-2 and W-2P on magnetic media appear in TIBs-4a, 4b, and 4c.

.03 Copies of Social Security administration publications TIB-4a, 4b, and 4c are available from any Internal Revenue Service Center or local Social Security Administration office.

SEC. 4. APPLICATIONS FOR MAGNETIC MEDIA REPORTING

.01 For the purposes of this revenue procedure, the payer is the organization making the payments and the transmitter is the organization preparing the tape file. The payer and transmitter may be the same organization. Payers or transmitters who decide to file information returns, in the Forms 1099 and 1087 series, on magnetic tape must complete Form 4419, Application for Magnetic Media Reporting Information Returns. Instructions for completing the application appear on the reverse side of the form.

.02 The Service will act on an application and notify the applicant of authorization to file within 30 days of receipt of the application. No magnetic tape returns may be filed with the Service until authorization to file is received.

.03 The Service will assist new filers with their initial magnetic tape submission by encouraging the submission of test tapes for review in advance of the filing season. Approved payers or transmitters who wish to submit a test tape should contact the magnetic media coordinator at the Service Center where the application was filed.

.04 Once authorization to file on magnetic tape has been granted to a payer or transmitter, it will remain in effect in succeeding years, provided that all the requirements of this revenue procedure are met and there are no hardware or software changes by the filer which would cause the tape to become unprocessable. If a filer discontinues filing on magnetic tape, a new application must be filed before this method of filing may be resumed.

.05 In accordance with Section 1.6041.7 of the Income Tax Regulations, medical payments from separate departments of a health care carrier may be reported as separate returns on magnetic tape. In this case, the headquarters office will be considered to be the transmitter and the individual departments of the company filing reports will be considered to be payers. A single application form covering all the departments which will be filing on magnetic tape should be submitted.

SEC. 5. FILING OF TAPE REPORTS

.01 A magnetic tape reporting package, which includes all necessary transmittals, labels, and instructions, will be mailed to all approved filers between October and December of each year.

.02 Payers may submit a portion of their information returns on magnetic tape and the remainder on paper forms, provided there is NO DUPLICATE FILING. The magnetic tape records and paper forms must be filed at the same location, but in separate shipments. A Form 1096, Annual Summary and Transmittal of U.S. Information Returns, MUST accompany paper submissions and a Form 4804, Transmittal of Information Returns Reported on Magnetic Media, MUST accompany magnetic tape submissions.

.03 The affidavit which appears on Forms 1096 and 4804 must be signed by the payer. A transmitter, service bureau, or disbursing agent may, however, sign the affidavit on behalf of the payer if all of these conditions are met:

a. It has the authority to sign the affidavit under an agency agreement (either oral, written, or implied) that is valid under the State law; and

b. It has the responsibility (either oral, written, or implied) conferred on it by the payer to request the taxpayer identifying numbers of payees reported on magnetic tape or paper returns; and

c. It signs the affidavit and adds the caption "For: (name of payer)".

.04 Although a duly authorized agent signs the affidavit, the payer is held responsible for the accuracy of the Form 4804 and will be liable for penalties for failure to comply with filing requirements.

.05 These requirements also apply to paper filers submitting Form 1096, Annual Summary and Transmittal of U.S. Information Returns. Paper filers are responsible for the filing of a correct, complete, and timely Form 1096. The failure of duly authorized "agents" of papers paper filers to comply with the filing requirements of Form 1096 and attachments does not relieve the payers of any penalties that may arise as a result of such failure to comply.

.06 If a portion of the returns are submitted on paper documents, include a statement on the Form 1096 that the remaining returns are being filed on magnetic tapes. Please note that Form 1096 instructions normally apply to the filing of information returns on paper; however, filers of magnetic tapes must review the Form 1096 instructions and file Form 1096 if appropriate.

.07 Health care carriers, or their agents, filing Form 1099-MED per Section 4.05 above, may submit part of their returns on paper documents and part on magnetic tape if the records of some departments are not maintained on computer files. However, an information return is required if the aggregate amount paid to a health care service provider from all departments equals $600 or more. For example, Department A pays $200, Department B pays $300, and Department C pays $100 to the same health care service provider. The aggregate amount paid from all departments equals $600. The health care carrier or agent must submit either one information return for the aggregate amount of $600 or three separate returns, one from each department, indicating the amount paid by each department.

.08 Reports of different branches of one payer, or for different types of accounts, should be consolidated under one Payer/Transmitter "A" Record.

SEC. 6. FILING DATES

.01 Magnetic tape reporting to the Service for all types of Forms 1099 and 1087 must be on a calendar year basis.

.02 The dates prescribed for filing paper returns with the Service will also apply to magnetic tape filing. Tapes must be submitted to the Service Center by February 28. The copies of this information required to be furnished to recipients must be furnished by January 31.

SEC. 7. EXTENSIONS TO FILE

.01 If a payer or transmitter is unable to submit its tape file by the date prescribed in Section 6.02 above, a letter requesting an extension must be filed before February 28. The letter should be sent to the attention of the magnetic media coordinator at the Service Center which will receive the tape file. The request should include the estimated number of returns which will be filed late and the reason for the delay.

.02 If an extension is granted by the Service, a copy of the letter granting the extension must be attached to the transmittal Form 4804 when the file is submitted.

SEC. 8. PROCESSING OF TAPE RETURNS

.01 The Service will process tax information from tapes. Tapes which are received timely by the Service will be returned to the filers by August 15 of the year in which submitted.

.02 All tapes submitted must conform totally to this revenue procedure. IF TAPES ARE UNPROCESSABLE, THEY WILL BE RETURNED TO THE FILER FOR CORRECTION. Corrected tapes must be filed with the Service Center as soon as possible. If the delay will be more than two weeks, contact the Service Center Magnetic Media Coordinator for instructions. Corrected files will be returned by the Service within six months of receipt.

SEC. 9. CORRECTED RETURNS

.01 If a large volume of corrected returns is necessary, and the payer or transmitter possesses the capability to provide such corrections on tape, they are encouraged to do so. The filer must contact the magnetic media coordinator for format and shipping instructions. A corrected Form 4804 must accompany the shipment and be marked "MAGNETIC MEDIA CORRECTION" on the upper portion of the form.

.02 If corrections are not submitted on tape, payers must submit them on official Form 1099 or 1087 (Copy A) or on paper substitutions approved for submission to the Service. Some paper substitutes approved for submission to payees as originals are not acceptable for submission to the Service as corrections. Revenue procedures containing specifications for paper returns are available from most Internal Revenue Service offices.

.03 Form 1096 instructions are to be followed when paper returns are filed to correct returns previously submitted on magnetic media. An "X" must be entered in the box in the left margin and the caption "MAGNETIC MEDIA CORRECTION" must appear on the top of the form. Corrections MUST be sent to the attention of the magnetic media coordinator where the original tape file was filed.

.04 Combined Federal/State Filers who submit paper corrections must file directly with the affected state. The service WILL NOT transship paper corrections to the states.

SEC. 10. TAXPAYER IDENTIFICATION NUMBERS

.01 Under Section 6109 of the Internal Revenue Code, recipients of dividends, interest, or other payments are required to furnish Taxpayer Identification Numbers (TINs) to the payer. The number must be furnished to the payer whether or not the payee is required to file a tax return or is covered by Social Security.

.02 The Service expects that payers will keep to a minimum those statements submitted without TINs. It is particularly important that correct social security and employer identification numbers for payees be provided on magnetic media or paper forms submitted to the Service.

.03 For each omission of a required TIN. Section 6676 of the Internal Revenue Code provides that the Service charge a $5 penalty unless the payer or payee responsible for furnishing the number supplies an explanation, upon request from the Service, that establishes reasonable cause for not having done so.

.04 The TIN to be furnished to the Service depends primarily upon the manner in which the account is maintained or set up on the payer's record. The TIN to be provided must be that of the owner of the account. If the account is recorded in more than one name, furnish the TIN and name of one of the owners of the account. The TIN provided must be associated with the name of the payee provided in the first name line of the Payee Record ("B" Record). (For individuals, including those individuals operating a business, the payee TIN is the payee's Social Security Number. For other entities, the payee TIN is the payee's Employer Identification Number.)

.05 Sole proprietors who are payers should show their employer identification number in the Payer/Transmitter "A" Record. However, the payer should use the social security number of a sole proprietor in the Payee "B" Record.

.06 The charts below will help you determine the number to be furnished to the Service.

 CHART 1. Guidelines for Social Security Numbers

.01 Magnetic tape reporting of the information returns listed in Section 1 above applies only to the original (Copy A).

.02 Payers are permitted considerable flexibility in designing the copy of the information return to be furnished to the payee. The payer may combine the information return data with other reports or financial or commercial notices, or expand them to include other information of interest to a depositor, patron, or shareholder. This is permissible so long as all required information present on the official form is included and the payee's copies are conducive to proper reporting of income on tax returns. Payers must include a message similar to "This information is being furnished on Form 1099 (or 1087) to the Internal Revenue Service" on the recipients' copies.

.03 If a portion of the returns is reported on magnetic tape and the remainder is reported on paper forms, those returns not submitted on magnetic tape must be filed on official forms or on paper substitutes meeting specifications in the revenue procedure on the reproduction of Forms 1099, 1087, and W-2G. Forms 1099-BCD, 1099-F, and W-2G cannot currently be filed on magnetic tape.

SECTION 12. MAGNETIC MEDIA COORDINATOR CONTACTS

Requests for additional copies of these revenue procedures or for additional information on tape reporting should be addressed to the attention of the magnetic media coordinator of one of the following:

          (a) Internal Revenue Service

.01 The Service will accept, upon prior approval, tape files containing State reporting information, for those States listed in Part B, Section 6.06 of this Revenue Procedure. The Service will then forward the information to the State indicated at no charge to the filers.

.02 Those filers wishing to participate in the program MUST submit a Consent for Internal Revenue Service to Release Tax Information.

.03 Those filers who are participating in the Combined Federal/State Filing Program MUST submit a test tape prior to receiving permission to file their actual data. Additionally, each record in the file MUST be 360 positions in length. The file MUST conform exactly to the specifications detailed in this procedure. The service will make no attempt to process files with any deviations and will revoke the filing authorization of any filer who submits files that do not totally conform.

.04 The Service is acting as a forwarding agent to simplify information return filing. Some participating States may require separate notification that you are filing in this manner. You should contact the appropriate States for further information.

.05 To simplify filing, several States have provided lists of their information return reporting requirements. See the following list. This cumulative list is for information purposes only. For complete information on State filing requirements you may want to contact the appropriate State tax agencies.

                       State Filing Requirements

SECTION 1. GENERAL

.01 The magnetic tape specifications contained in this part define the required format and contents of the records to be included in the file. These specifications must be adhered to unless deviations have been specifically granted by the Service in writing.

.02 In most instances, the Service will be able to process any compatible tape files. Compatible tape files must meet any one set of the following:

(a) 7 channel BCD (binary coded decimal) with

(1) Either Even or Odd Parity and

(2) A density of 556 or 800 BPI.

(b) 9 channel EBCDIC (Extended Binary Coded Decimal Interchange Code) with

(1) Old Parity and

(2) A density of 800 or 1600 BPI.

(c) 9 channel ASCII (American Standard Coded Information Interchange) with

(1) Odd Parity and

(2) A density of 800 or 1600 BPI.

.03 Although the Service can process, after translation, tapes created at 6250 BPI, it is preferred that filers submit 1600 BPI tapes if possible. Payers/Transmitters must request permission from the service center magnetic media coordinator before submitting 6250 BPI tapes.

.04 All compatible tape files must have the following characteristics:

(a) Type of tape -- 1/2 inch Mylar base, oxide coated; and

(b) Interrecord Gap -- 3/4 inch.

.05 Service programs are capable of accommodating some minor deviations, except for those filers participating in the Combined Federal/State Filing Program. Payers who can substantially conform to these specifications, but do require some minor deviations, must contact the magnetic media coordinator at the service center where the file will be submitted. Under no circumstances may tapes deviating from the specifications in this revenue procedure be submitted without prior written approval from the Service.

SEC. 2. DEFINITIONS

 Element            Description

.01 The tape records defined in these specifications may be blocked or unblocked, subject to the following:

(a) A block must not exceed 4,000 tape positions.

(b) A record must be a minimum of 200 positions and a maximum of 360 positions.

A fixed record of 360 positions is recommended.

(c) If the use of blocked records would result in a short block, all remaining positions of the block must be filled with 9's. Do not pad a block with blanks.

(d) All records except the Header and Trailer Labels may be blocked.

.02 A provision is made in the Payee "B" Records for special data entries. These entries are optional. If the field is utilized, it must be present on all Payee "B" Records. The field is intended to serve one or both of these purposes:

(a) Contain information required by state or local governments. Filers who wish to use this option for satisfying state or local reporting requirements should contact their state or local department of revenue for filing instructions. Also refer to Part A, Section 13.

(b) Facilitate making all records the same length.

SECTION 4. OPTIONS FOR FILING

.01 For filing convenience, this procedure contains two options for using Header Labels and Payer/Transmitter "A" Records. For the purposes of this procedure the following conventions must be used.

Header Label:

1. Payers may use standard headers provided they begin with 1HDR, HDR1, VOL1, VOL2, or "bLABEL".

2. Consist of a maximum of 80 positions.

3. Position 9 MUST NOT contain the letters A, B, C, D, E, F, or K.

Trailer Label:

1. Standard trailer labels may be used provided that they begin with 1EOR, 1EOF, EOR1, or EOF1.

2. Consist of a maximum of 80 positions.

Record Mark:

1. Special character used to separate blocked records on tape.

2. Can be written only at the end of a record or block.

3. For odd parity tapes, use BCD bit configuration 011010 ("A82").

Tape Mark:

1. Used to signify the physical end of the recording on tape.

2. For even parity, use BCD configuration 001111 ("8421").

3. May follow the header label and precede and/or follow the trailer label.

Option 1: When using this option, a correct Payer/Transmitter "A" Record, described in Sec. 5 below, is required as the first record on each file. The reel sequence number must appear in positions 3-5 of each "A" Record and must be incremented by 1 on each tape reel of the file after the first reel. Filers using this option may have Header Labels preceding the "A" Record, however, headers are not required.

Option 2: Requires a Header Label as the first record on each reel. The Header Label must contain the reel sequence number and it must be incremented by 1 on each reel after the first reel. The "A" Record will contain the location of the reel sequence number in the Header Label. If your system generates a four digit reel sequence number, ignore the first digit when determining the location for the purposes of the "A" Record. This option requires a Trailer Label at the end of each reel.

Example: If your Header Label reel sequence is four digits (e.g. 0001) and is in positions 28-31, enter "29" as the location in positions 3 and 4 of the "A" Record and also enter an "X" in position 5 of the "A" Record.

Example: If your Header Label reel sequence is 3 digits (e.g. 001) and is in positions 10-12, enter "10" as the location in positions 3 and 4 of the "A" Record and also enter an "X" in position 5 of the "A" Record.

SEC. 5. PAYER/TRANSMITTER "A" RECORD

Identifies the payer and transmitter of the tape file and provides parameters for the succeeding Payee "B" Records. The Service's computer programs rely on the absolute relationship between the parameters in the "A" Record and the data fields in the "A" Record and the data fields in the "B" Records to which they apply.

The number of "A" Records appearing on a tape reel will depend on the number of payers and the different types of returns being reported. A transmitter may include Payee "B" Records for more than one payer on a tape reel, however, each payer's Payee "B" Record(s) must be preceded by an "A" Record. A single-tape reel may also contain different types of returns, but the returns may not be intermingled. A separate "A" Record is required for each type of return being reported. An "A" Record may be blocked with "B" Records, however, the "A" Record must appear as the first record in the block.

               RECORD NAME: PAYER/TRANSMITTER "A" RECORD

.01 Contains the payment record from individual statements. All records must be a fixed length. Records may be blocked or unblocked. A block may not exceed 4000 positions. DO NOT PAD A BLOCK WITH BLANKS.

.02 All payee records must contain correct payee name and address information entered in the fields prescribed in this section.

.03 The Service must be able to identify the surname associated with the taxpayer identifying number (SSN or EIN) furnished on a statement. The specifications below include a field in the payee records called "Name Control" in which the first four alphabetic characters of the payee's surname are to be entered by the payers. In addition, a blank MUST precede the identifying surname in the first name line of all Payee "B" Records unless the surname begins in the first position of the field.

.04 If payers are unable to provide the first four characters of the surname, the specifications permit the submission of statements on magnetic tape with the Name Control Field left blank; however, compliance with the following will facilitate the Service computer programs required to generate the Name Control.

(a) The surname of the payee whose Taxpayer Identifying Number (SSN or EIN) is shown in the Payee "B" Record, must be the only name in the first name line.

(b) A blank must precede the surname unless the surname begins in the first position of the field.

(c) In the case of multiple payees, only the surname of the payee whose Taxpayer Identifying Number (SSN or EIN) is shown in the Payee "B" Record, must be present in the first name line. Surnames of any other payees in the record must be entered in the second name line.

.05 Provision is also made in these specifications for data entries required by state or local governments. This should minimize the Payer/Transmitter's programming burden should payers desire to report on tape to state or local governments.

.06 Those filers participating in the Combined Federal/State Filing Program must have 360 position records. Positions 359 and 360 in the Payee "B" Records must contain the state code for the state to receive the information. Do not code for the states unless prior approval to participate has been granted by the IRS.

The codes for the participating states are:

 State                                                            Code

.01 The End of Payer "C" Record is a summary record for a Type of Return for a given payer. It MUST be the same length as the "B" Records in the payer's file.

.02 The "C" Record will contain the totals of the payment amount fields and the payees filed by a given payer. The "C" Record must be written after the last payee record for each Type of Return for a given payer. For each "A" Record on the file, there must be a corresponding "C" Record.

.03 Payers/transmitters must verify the accuracy of the totals in the "C" Record and must enter the totals on the transmittal, Form 4804, which will accompany the shipment.

.04 The "C" Record cannot be followed by a Tape Mark.

                 RECORD NAME: END OF PAYER "C" RECORD

.01 The State Totals "K" Record is a summary for a given payer and a given state in the Combined Federal/State Filing Program, used ONLY when State Reporting approval has been granted. It must be 360 positions in length.

.02 The "K" Record will contain the totals of the payment amount fields and the payees filed by a given payer for a given state. The "K" Record(s) must be written after the "C" Record for the related "A" Record.

.03 There MUST be a separate "K" Record for each state being reported.

.04 The "K" Record cannot be followed by a Tape Mark.

                 RECORD NAME: STATE TOTALS "K" RECORD

.01 The "F" Record is a summary of the number of payers and tapes in the entire file.

.02 This record should be written after the last "C" Record or "K" Record whichever is applicable.

.03 Only a Tape Mark or a Tape Mark and Trailer Label may follow the "F" Record.

.04 The "F" Record MUST be the same length as the "B" Records.

              RECORD NAME: END OF TRANSMISSION "F" RECORD

(REEL SEQUENCE NUMBER IS IN THE PAYER/TRANSMITTER "A" RECORD.)

.01 The following charts show, by type of file, the record types to be used in the first two and the last three records written on a tape reel when only one type of document (file) is reported on a reel or series of reels. /*/

.02 When reporting under the Combined Federal/State Filing program the State Total's "K" Record(s) will follow the "C" Records regardless of the Type of File.

                                                2nd

² Tape Mark.

/*/ When more than one Type of Document (file) is reported on a tape reel, there will be a corresponding increase in the series of "A", "B--B" and "C" records since, within a tape reel, a file is equivalent to an "A" record, a series of "B" records and a "C" record for a single payer.

SEC. 11. TAPE LAYOUTS-OPTION 2

(REEL SEQUENCE NUMBER IS IN THE HEADER LABEL.)

.01 Where the Header Label is the first record, the following charts show, by type of file, the record types to be used in the 2nd and 3rd records and the last three records written on a tape reel prior to the trailer label when only one type of document (file) is reported on a reel or series of reels. /*/

.02 When reporting under the Combined Federal/State Filing Program the State Total "K" Record(s) will follow the "C" Records regardless of the Type of File.

                                                2nd

² Must contain "Number of Payees" and "Control Totals" summarizing all Payee "B" Records written for this Type of Document for this payer on this reel and on prior reel(s).

/*/ When more than one Type of Document (file) is reported on a tape reel, there will be a corresponding increase in the series of "A", "B--B" and "C" records since, within a tape reel, a file is equivalent to an "A" record, a series of "B" records and a "C" record for a single payer.

SEC. 12 EFFECT ON OTHER DOCUMENTS

Rev. Proc. 81-34 is superseded.

SEC. 13. RECORD LAYOUTS

[Editor's note: These record layouts are graphic representations of the file specifications described above. They have been omitted because they provide no additional information and are not suitable for clear on-screen presentation.]