1099-INT

[RDNKCPA]

I have a client that loaned personal money to his 1120 C corp several years ago. He's winding down his business this year and the business is paying off the loan. He cut himself a $10,000 check for the accrued interest on the original not amount. I reported the 10K on his personal return, should I generate a 1099-INT for this transaction?

Thanks.

[Terry D EA]

I don't do any C-Corps with any regularity but just wondering if the same ordering rules that apply to an S-Corp shareholder apply to a C-Corp shareholder. I would think the 1099INT should be generated.

[Lee B]

File the 1099 - INT. There will a one month late filing penalty.

But that will protect your client from a much larger penalty for not filing at all.

From a small sample over the years, whatever computer matching the IRS may do seems to concentrated on the recipient

not on the payor, but that's not much comfort if your client's the one that receives the penalty.