Should I be seriously worried if I've never filed a 1099-int? (2024)

FAQs

Should I be seriously worried if I've never filed a 1099-int? ›

Seriously worried? No -- but this is a situation not to be ignored. You are required to report all income, no matter how small, and regardless of whether you got a form or not.

Remember that an audit is not a certainty just because of a missing 1099. The IRS receives a lot of information and only audits a small percentage of tax returns each year. However, it's still important to correct your tax filing.

An information return penalty may apply if you don't file information returns or provide payee statements timely or accurately. We mail you a notice if you owe a penalty and charge monthly interest until you pay the amount in full.

The IRS employs various methods to detect discrepancies in tax reporting, including the absence of 1099 forms. While the IRS does not catch every missing 1099 immediately, their sophisticated systems and data-matching capabilities make it likely that discrepancies will be identified over time.

You use your IRS Form 1099-INT to help figure out how much income you received during the year and what kind of income it was. You'll report that income in different places on your tax return, depending on what kind of income it was.

But what are the actual odds of getting audited? Shockingly low for most people. The number of IRS audits has been declining for years. Today, an American's overall chances of being audited are about 1 in 200.

The short answer is, you will pay a fine. It does not need to be a hefty fine if you take the proper steps moving forward. Employers can resolve any missing 1099 forms. It is not necessarily too late to send a missing information return, whether your business or the Internal Revenue Service realizes it first.

File Form 1099-INT, Interest Income, for each person: To whom you paid amounts reportable in boxes 1, 3, or 8 of at least $10 (or at least $600 of interest paid in the course of your trade or business described in the instructions for Box 1.

I received a Form 1099-INT after I filed my return. What do I do? If you received a Form 1099-INT after filing your return, you should file an amended federal and State return.

Failing to report income may cause your return to understate your tax liability. If this happens, the IRS may impose an accuracy-related penalty that's equal to 20% of your underpayment.

Can you file a 1099 a year later? ›

In most cases the 1099 statute of limitations is three years. Those three years begin on the due date of the return or the date on which it was filed – whichever is later.

If a discrepancy exists, a Notice CP2000 is issued. The CP2000 isn't a bill, it's a proposal to adjust your income, payments, credits, and/or deductions. The adjustment may result in additional tax owed or a refund of taxes paid.

Even if you did not receive a Form 1099-INT, or if you received $10 or less in interest for the tax year, you are still required to report any interest earned and credited to your account during the year.

You must report all taxable and tax-exempt interest on your federal income tax return, even if you don't receive a Form 1099-INT or Form 1099-OID. You must give the payer of interest income your correct taxpayer identification number; otherwise, you may be subject to a penalty and backup withholding.

If you receive a Form 1099-INT and do not report the interest on your tax return, the IRS will likely send you a CP2000, Underreported Income notice. This IRS notice will propose additional tax, penalties and interest on your interest payments and any other unreported income.

If you receive a Form 1099-INT, you'll need to include the amount shown in Box 1 on the “taxable interest” line of your tax return. Report any tax-exempt interest shown in Box 8 of the 1099-INT on the “tax-exempt interest” line of your tax return.

Taxpayers may need to file an amended return if they filed with missing or incorrect info. If they receive the missing or corrected Form W-2 or Form 1099-R after filing their return and the information differs from their previous estimate, they must file Form 1040-X, Amended U.S. Individual Income Tax Return.

Once you realize that you forgot to report your 1099 income on your tax return, you can amend the return to reflect this income. You must complete and submit Form 1040-X for each return you are amending.

I received a Form 1099-INT after I filed my return. What do I do? If you received a Form 1099-INT after filing your return, you should file an amended federal and State return.