IRS Temporarily Tries Out Truncated TINs for 2009 and 2010

On November 19, 2009, the IRS issued Notice 2009-93, 2009-51 IRB, which provides for a voluntary pilot program that permits a plan administrator to truncate an individual payee's nine-digit identifying number on paper Forms 1099-R (including substitute and composite substitute statements) issued for calendar years 2009 and 2010. The Notice does not apply to filings with the IRS, electronically furnished payee statements, and payee statements not in the Form 1098, 1099, or 5498 series (such as a Form W-2).

The requirements to participate in this program are:

• The identifying number must be an SSN, TIN, or adoption TIN;

• The identifying number is truncated by replacing the first five digits with asterisks or Xs (e.g., "123-45-6789" would be truncated as "***-**-6789" or "XXX-XX-6789"); and

• The truncated identifying number appears on a paper payee statement (including substitute and composite substitute statements) in the Form 1098, 1099, or 5498 series for calendar year 2009 or 2010.

If the requirements are satisfied, then the filer is deemed to have complied with any requirement in Treasury and IRS guidance, whether in regulation, form, or form instructions, to include a payee's identifying number on a payee statement.

The IRS has also solicited comments to the Notice by May 1, 2010, specifically concerning: (1) whether truncations should be required, rather than permitted, (2) whether other Form series should be included, (3) whether electronically furnished statements should be included, (4) whether complete numbers should be included upon payee request, and (5) whether truncation creates difficulties for filers and/or payees.

Please contact Mary Beth Braitman, Terry A.M. Mumford, Lisa E. Harrison , or Katrina M. Clingerman if you need any further information.