Corrections are required when the IRS has received the form data. A TIN change is considered a Type 2 or Two Transaction correction. For sites that do not use Advantage Tax Reporting functionality or the consolidation option on TAXOPT is not chosen, the following steps should be taken to process a TIN change using an M1099 transaction. The M1099 transaction allows users to make updates to records on 1099R table without having direct access to the table.
When the M1099 transaction is used to make a TIN Change, the record with the incorrect TIN will need to be zeroed out and a new TIN record will be created with the reported amounts. The reason for the two step process is that the M1099 transaction uses the TIN to find the 1099R record.
When the TIN needs to be changed, the new TIN needs to be added to 1099I table before making the changes on 1099R table. This may be done directly on 1099I with the correct security or via the VCM transaction.
From 1099R table, find the current record and select the ‘Modify Existing Record’ link to create an M1099 transaction with the existing record’s data.
You will be transitioned to the Create Transaction page to enter the transaction number.
Once the transaction number is entered, select the ‘Create Transaction’ link.
The M1099 transaction will be created and the Header section will be displayed. If no entry is required on the Header, go to the Reported Income section.
On the General Information tab, copy Line 1 (old TIN and it will have an Action of Modify) and select the Insert Copied Line button to paste and create Line 2.
On Line 2, change the Action to ‘New’ and enter the correct TIN, add a Comment if needed. The name and address will be inferred from 1099I table and the amounts will remain from the copied values.
Return to Line 1, go to the Reported Income Information tab and reduce all the amounts to zero.
Verify all fields are as expected then validate/submit the transaction and close the transaction.
A new record will be inserted to the 1099R page with the updated changes from the transaction and the record should have a Processing Indicator of ‘Updated’ for the old TIN record. The amounts for this record should be zeroes.
Another record will be inserted with the Processing Indicator of ‘New’ for the new TIN. This record should contain the correct TIN along with the data in the boxes.
When the Offline 1099 Process is executed, the updated record will be processed and the corrected records will be created and appear in the text files.
For Tax Reporting sites, when the corrected record is updated to the Form Reporting page, a new version will be inserted for each TIN.