CP2100 and CP2100A Notices: Payee Names and TINs That Do Not Match

What the CP2100 and CP2100A notices say

The IRS page says the payee’s name and TIN on your information return “is missing or doesn’t match our records,” and that you may need to begin backup withholding on those payee accounts. Backup withholding means the business holds back part of each payment to that payee and sends it to the IRS. The IRS page puts the current rate at 24% of payments.

The two notices carry the same instructions. The IRS page says it sends a CP2100 when a payer filed 50 or more information returns with errors, and a CP2100A when it filed fewer than 50. It issues them “twice a year, in October and the following April.”

IRM 4.23.8.14.1 lists what the IRS checks for on Forms 1099: missing TINs, obviously incorrect TINs, mismatched names and TINs, and TINs the government never issued.

Two lists, two different jobs

Missing or obviously incorrect TINs. An obviously incorrect TIN has fewer or more than 9 digits, or holds something other than numbers. The IRS page says to begin backup withholding on these payees right away if you have not already, and to keep withholding until the payee gives you a TIN. The page lists two exceptions: you had the TIN when you paid but left it off the return, or the TIN dropped off during electronic filing. It also says you must make up to three requests for the TIN to avoid a penalty for leaving it off the information return.

TINs that do not match IRS records. Compare each one with your payee records. If your records show the same name and TIN as the notice, send the payee the right “B” notice. If your records differ from the notice, the mismatch may come from a recent update, an error in what you filed, or an IRS processing error. In that case, the IRS page says you only need to correct or update your records.

To catch bad TINs before you file next time, the IRS page says payers of most Forms 1099 can apply to use the IRS TIN Matching program. The IRS mails these notices to your address of record; if yours changed, the page points to Form 8822-B.

IRM 4.23.8.14.1 adds a point many payers miss: under IRC 3406(a)(1)(A), a payer must backup withhold while a payee has not furnished a TIN, “regardless of whether the payor receives and complies with” a CP2100.

The clock for a mismatched TIN

Treasury Regulation 31.3406(d)-5 sets the dates. Send the payee the B notice within 15 business days after you receive the CP2100 or CP2100A.

If the payee does not give you a certified TIN, you must backup withhold on payments to that account made after the close of the 30th business day after you received the notice. Once the payee certifies a TIN, you stop withholding no later than the 30th calendar day after you receive it. The payee certifies on Form W-9, which IRM 4.23.8.14.1 names for a first B notice. The IRS page says to deposit the backup withholding under the monthly or semi-weekly schedule, and points to Publication 15 for details.

Our information return penalty calculator estimates the penalty for filing information returns with missing or incorrect information, if that question comes up later.

The second notice in three years

The rule changes if the same account shows up again. Under Treasury Regulation 31.3406(d)-5(g), if a payer receives two notices for a payee’s account within 3 calendar years, it sends a second B notice instead of the first one.

After a second B notice, a new Form W-9 is not enough. The payer must keep backup withholding until the payee shows validation from the Social Security Administration or the IRS. IRM 4.23.8.14.1 says a Social Security card can serve as that validation for a Social Security number, and IRS Letter 147C can serve for an employer identification number.

What people mistake the CP2100 for

Some payers read a CP2100 as a penalty notice. The IRS page describes no amount due; the notice tells you which payees need follow-up and when backup withholding may start.

Others think they must tell the IRS when they fix a TIN. The IRS page says no: correct your records and stop backup withholding on future payments to that payee.

Some also think backup withholding on a missing TIN starts only when a notice arrives. The IRM says the duty applies whether or not a CP2100 arrives.

Common Questions