ITG FAQ # 13 Answer - When is truncation of payee identification number on paper statements allowed?


Truncating payee identification number on paper payee statements (Forms 1098 series, 1099 series, and 5498 series). 

Notice 2009-93 allows filers of information returns in the Form 1098 series, Form 1099 series, and Form 5498 series to truncate an individual payee's SSN, ITIN, or ATIN on paper payee statements for tax years 2009 and 2010. Filers may truncate a payee's identification number on the payee statement (including substitute and composite substitute statements) furnished to the payee in paper form only. Generally, the payee statement is that copy of an information return designated "Copy B" on the form. A "payee" is any person who is required to receive a copy of the information set forth on an information return by the filer of the return. For some forms, the term "payee" will refer to beneficiary, borrower, debtor, insured, participant, payer, policyholder, recipient, shareholder, student, or transferor. If a filer truncates an identification number on Copy B, other copies of the form furnished to the payee may also include a truncated number.

A filer may not truncate a payee's identification number on any forms filed with the IRS or with state or local governments, on any payee statement furnished electronically, or on any payee statement not in the Form 1098, Form 1099, or Form 5498 series. A filer's identification number may not be truncated. A payee's employer identification number may not be truncated. Further, note that Form 1098-C is excluded from the scope of Notice 2009-93 as Copy B is an acknowledgement to a donor and not a payee statement. To truncate, replace the first 5 digits of the 9-digit number with asterisks (*) or Xs (for example, an SSN xxx-xx-xxxx would appear on the paper payee statement as ***-**-xxxx or XXX-XX-xxxx).

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