Draft 1099-MISC - Changes for 2014 reflect FATCA-related and broker reporting provisions 

July 11: The IRS released a draft version of Form 1099-MISC, Miscellaneous Income, and the instructions for Form 1099-MISC proposed for use in 2014.

The draft instructions reflect FATCA-related reporting and market discount reporting requirements under final regulations from April 2013.

The draft instructions [PDF 475 KB] for Form 1099-MISC (2014) [PDF 195 KB] reflect the following revisions:

  • Box 11 (foreign tax paid) and box 12 (foreign country or U.S. possession) are deleted to reflect that FATCA-related information will be reported on Form 8966, Foreign Asset Tax Compliance Act Report.
  • New box 11 (market discount)* is added.

*Final regulations issued in April 2013 concerning basis reporting by brokers require the reporting of market discount beginning January 1, 2014, if the taxpayer makes a section 1278(b) election. Read TaxNewsFlash-United States: Regulations - Broker reporting of basis, premiums relating to debt instrument, option transactions

The draft Form 1099-MISC is dated July 8, 2013; the draft instructions are dated July 10, 2013, and both are subject to OMB review prior to being finalized.

KPMG observation

It is unclear at this time why the current box 11 (foreign tax paid) and box 12 (foreign country or U.S. possession) would be removed from the Form 1099-MISC, as neither of these items appears to concern FATCA reporting as the instructions state.

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