If your business has a large number of customers or vendors, then you are probably familiar with the challenge of maintaining accurate name and TIN information for 1099 tax reporting purposes. Collecting a W-9 during customer onboarding and doing a proactive real-time TIN and name check with the IRS database are solid best practices every organization should follow to ensure accurate information from the get-go.  But even the best due diligence process cannot fully maintain accurate information if only performed once – because one of the constants in life (and business), is things are always changing!

Marriage, divorce, death, business mergers, acquisition, incorporation and changes in reporting status can all mean the data you have no longer matches IRS records.

Luckily there is an efficient process called a Bulk TIN Match that can help catch changes in your customer/vendor database and make sure you have time to correct them before the busy tax filing season.  Here are three reasons you should consider conducting a Bulk TIN Match at least once per year:

  1. Ensure you have accurate tax data for filing:  As stated above, a lot can change in a year. If you have thousands of records to verify, it’s a given that many of them may have changed.  Even if you have a process for managing changes, it’s often the case that things can slip through the cracks. Therefore, it’s a good idea to run a Bulk TIN Match prior to tax season. With a Bulk TIN Match, you can have your whole database validated at once and have the results back usually in a day.  This gives you time to solicit correct information and is a lot less work than dealing with IRS error notices and potential penalties.
  2. Mergers & Acquisitions / Subsidiaries:  If your company acquired a business over the past year and your team is taking on the expanded responsibility of W-2 or 1099 reporting, it’s good practice to assume the data from the acquired company may need to be verified.  Similarly, if you will be taking on the management of the reporting process for a subsidiary that may not have the same due diligence processes, verifying the data with a Bulk TIN Match is a fast and cost-effective way to surface any issues prior to season. This can prevent time consuming rework and the risk of penalties down the road.
  3. Focused Solicitation: One way to maintain accurate records for customers and contractors is to solicit a new W-9 every year. Some organizations employ this practice to maintain accurate records.  If you have a handful of W-9’s to handle every year, this approach may make sense.  But if you manage hundreds or thousands, this approach is needlessly time-consuming and is an unnecessary burden on most of your payees. With a Bulk TIN check, you can validate all your records, review the results and then focus efforts on follow up where you may have mismatches or red flags. This allows you to efficiently focus your effort so you can spend time on more important tasks.

TINCheck Bulk can make the process of maintaining the accuracy of your customer and vendor lists a turnkey process while adding an extra layer of verification to compliment real-time checks and ensure accurate and timely 1099 reporting.