TaxBandits Knowledge Base

What are the penalties associated with Form 1099-OID?

The IRS may impose penalties on 1099-OID Forms for the following reasons:

• Not filing by the due date
• Not filing a proper 1099 paper form that's machine-readable
• Using the form for the wrong year
• Furnishing an incorrect form to the recipient
• Filing with incorrect information

The penalties for failing to file or for filing an incorrect form are as follows:

• For each Form 1099-OID that is filed late or with incomplete information, the penalty ranges from $60 to $310 per form, depending on how long past the due date the form is filed.
• If you intentionally disregard the requirement to file a correct and complete Form 1099-OID, the penalty can be as much as $630 per form, or 10% of the total amount of OID required to be reported on the form, whichever is greater.

It's important to note that these penalties can be significant, so it's important to ensure that you file Form 1099-OID accurately and on time to avoid any potential penalties.