What is data legitimacy verification, and why is it required?

 Data Legitimacy Verification is the process of ensuring the accuracy and authenticity of both the recipient and payment data reported on the tax forms. This verification confirms that the recipient’s details (such as name, address, and taxpayer identification number) and the reported payment data (including income, withholdings, and tax deposits) are accurate and match the actual records.

 

Why is it required?

This verification is crucial to ensure that the information on tax forms aligns with official records, thereby minimizing the risk of delays or errors. Without this verification, the forms may be flagged for discrepancies, leading to delays or rejections of your filings. 

The documents you upload will be used to verify the authenticity of the reported recipient and payment data, ensuring that all information is accurate and legitimate.

 

Acceptable documents

• Pay Stubs/Statement: Copies of pay stubs or payment statements detailing gross earnings, tax withholdings, and payment dates for the recipient. These documents help verify the reported income and ensure that the tax withholdings are accurate, supporting the amounts reported on the form.

• Tax Liability Report: A summary of your business’s total tax liabilities, confirming that the reported wages, withholdings, and other taxes for the filing period are accurate. This document validates the reported payment amounts and provides assurance that the correct taxes have been accounted for.

• Payroll Journal: A comprehensive record of payroll transactions supporting the payments made to employees or contractors. The journal details the amounts paid to each recipient, including the taxes withheld, and ensures that these amounts match the information reported on the form.

• Year-to-Date (YTD) Payroll Summary Report: A summary of total wages paid, taxes withheld, and employer contributions for the year-to-date period. This report consolidates payroll data and ensures that the information aligns with the reported amounts for the recipient, further verifying the data's legitimacy.
   

• Other Supporting Documents: Any additional documentation that helps confirm the accuracy and legitimacy of the reported recipient and payment data. These could include tax adjustments, updated forms, or records that support any discrepancies or modifications in the reported information.

 

Key points to remember

• Ensure Document Validity: Upload only valid and legitimate documents. Invalid or incomplete documents may delay your filing process.

• Upload Accurate Information: Double-check that the data in your supporting documents, including recipient details and payment data, accurately matches the reported information on your tax forms. Discrepancies may result in delays or rejections.

• Ensure Legibility: Make sure all documents are clear and readable. Avoid submitting blurry or unclear copies, as they may be rejected or cause delays.