Masking Tax ID Numbers (TINs) on recipient forms
Masking (also called Truncating by the IRS) results in the 9 digit TIN being
displayed as XXXXX1234, or XX-XXX1234, or XXX-XX-1234 for security. This is
similar to the way credit card numbers are displayed as XXXX XXXX XXXX 1234 on
your credit card receipt.
Finally the IRS has allowed
Masking of all recipient Tax ID Numbers for security purposes.
See this link for the final IRS regulations.
For example, if a
payee's 1099 form is stolen from a mailbox, the payee's full number is not
displayed. Just the right 4 digits are displayed, so the recipient knows this is
his number. This protects the recipient/payee from identity theft and is the
reason the IRS now allows Truncation/Masking of all Tax ID numbers. If the payee's identity is compromised
or stolen due to your failure to Mask, then the payee
may be able to hold you responsible for NOT using Truncation as allowed and
recommended by the IRS.
Masking protects both personal Social Security Numbers (SSNs) and company
Employer Identification Numbers (EINs) from disclosure.
Masking is SET by default. 1099 Express will mask automatically where necessary.
Masking can be stopped, but we do not recommended it. To stop masking click on the FILE menu, then PAGE SETUP,
then choosing the Masking Tab.
Masking is automatically allowed on pre-printed forms Copy B, Copy 2, etc, but
stopped on Copy A to the IRS. When filing to the IRS on paper forms, always be
sure the full Tax ID number (all 9 digits) is shown. Of course, when
are e-Filed to the IRS, the full Tax ID (all 9 digits) are always present in the
e-File, which is delivered to the secure IRS FIRE site.