The person who's been managing 1099 reporting said that if an entity has been paid less than $600, he did not report...


Q. (cont.) I think all payments made to various entity accounts should be combined and reported under the parent company. Also, what's the difference between the IRS TIN matching service and using a vendor's service?

A. With regard to the “entity” payments—are these entities subsidiaries of a parent, or merely divisions within a large organization? Do the entities have separate tax ID numbers (EINs) or do they share a single EIN? What is the tax classification of the parent, and of the entities?  

Regarding the IRS TIN Matching program, it is a free service provided by the IRS, but there are service providers that offer to take care of it for companies. To use the IRS service, you must first register for IRS e-Services, and this requires submission of personal identification and tax information, included adjusted gross income. The purpose is to validate the individual signing up, but in a number of organizations, officers/managers are reluctant to register.  By using a service, we believe that individual registration is by-passed, and the third party takes care of submitting your TINs for match, providing you the results. So some companies are willing to pay for those services.

See TAPN’s IRS TIN Matching Program in the 1099 section. Also, here is the IRS e-Services Registration page.

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