Any company that submits IRS Forms 1099 to the IRS can possibly benefit from using the IRS Taxpayer Identification Number (TIN) Matching program. The program is a free service included in IRS e-services. Any authorized person can access e-services and submit payees for the matching process. The IRS will not tell you the correct TIN but they will let you know that the TIN and Name combination you submitted is incorrect. You can then go back to the payee for a corrected Form W-9, which is a request for a Taxpayer Identification Number. A correct W-9 is the key to a correct Form 1099.
The purpose of TIN Matching is to help you avoid mismatches, IRS “B” Notices, Backup withholding Notices and the company potential penalties. TIN Matching is not mandatory but recommended. It is hoped that TIN Matching will save you time, money and potential penalties.