Our January issue of Tax Tips newsletter was mailed last month. This newsletter is sent to current tax and records clients, if you would like to be added to the mailing list for future editions please contact your local office. We anticipate sending this out quarterly. Below is an excerpt from the newsletter, to read the whole thing click here.
2009 Changes to be Aware Of by Jean Conklin, EA – Loan Officer/Farm Tax Specialist
Lump-Sum Timber Sales Now Require Issuance of Information Return Form 1099-S
The IRS has announced the finalization of amendments to the Income Tax Regulations under section 6045(e) of the Internal Revenue Code. These amendments provide that sales or exchanges of standing timber for lump-sum payments are “reportable real estate” transactions. The lump sum sales or exchanges should be reported using Form 1099-S, Proceeds from Real Estate Transactions. The amendments apply to sales completed after May 28, 2009. This change is in addition to the previously existing requirement for reporting of pay-as-cut timber sales using Form 1099-S.
Form 1099-S, Copy B, must be furnished to the timber seller by January 31st of the year after payment is made. Copy A is filed with the IRS by February 28th using a Form 1096. Completion of the form for each purchase requires the buyer to obtain the seller’s taxpayer identification number (TIN). This may be requested by using Form W-9, Request for Taxpayer Identification Number.
For further assistance, please feel free to call a Financial Services Representative at your local office.
