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Out of Sight, Out of Control?
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In accounts payable, small problems can quickly turn big if ignored. When problems grow, so do the costs associated with resolving them.
For instance, not requiring vendors to submit a form W9 can lead to cumbersome backup withholding. Undetected fraud cases can cost a company millions. This issue demonstrates what can happen when problems are ignored. |
| Patrick Harbin – Editor
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When to Backup Withhold |
It is essential for AP departments to have valid taxpayer ID numbers on file for each vendor. If an independent contractor fails to provide you with a valid TIN, then you could find yourself having to perform the dreaded 28 percent backup withholding.
The IRS notifies payers they must perform backup withholding by sending out warnings called B-notices. The following is a basic outline of the B-notice process:
- At receipt of first B-notice, payer must begin backup withholding and provide payee with a copy of the B-notice.
- Backup withholding continues until the payee sends the payer a certified W9.
- If the payer receives two or more B-notices in three years, backup withholding continues until they receive verification of the payee's TIN from the IRS and Social Security Administration.
Payers must know when to withhold, what payments qualify, and what happens if they fail to withhold. Be sure to sign up for The Accounts Payable Network's upcoming audio conference, When is Backup Withholding Required?, featuring Steve Mercatante, Esq., Attorney-Advisor and In-House Counsel, Balance Consulting.
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| Professors Face Fraud Charges |
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Two former professors at the Georgia Institute of Technology are facing fraud charges for allegedly double billing the university for travel expenses and making $80,000 in inappropriate disbursements to a family member. Read the full story..
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Just for Fun! |
It's been four months since we all made our new year's resolution to become more fit. Even if we've been good and changed our diets, there's a chance we're still not eating what we should.
Men's Health Magazine recently released a list of 14 health foods that really aren't that healthy. See Eat This, Not That to find out why a ham, egg and cheese muffin may be better for you than that bran muffin.
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