Publication 4267E Catalog Number 37832Y Pacific Northwest Edition 

January 2008 

Message from the Director 

We recently published the results from our fifth annual Customer Satisfaction 

Survey, and a summary is included in an article in this issue of ITG News. One 

of the questions posed in the survey seeks tribal input on our role in helping 

address the individual tax issues faced by tribal members. It has always been 

cited as an area where we need to improve. 

One of the difficulties we face in helping address member issues is that we 

have no authority over individual federal tax issues. Individual tax matters are 

assigned to our Wage and Investment Division or our Small Business/SelfEmployed Division. Thus, our role is somewhat limited, but we continue to 

make efforts to raise issues within the Service and to assist tribal members 

with information they need to be fully compliant with federal tax requirements. 

We have also forged a relationship with the Taxpayer Advocate Service that is 

designed to elevate systemic problems that are adversely impacting tribal 

members. 

One current example of both the problems we all face and the steps we are 

taking to assist on tribal member issues involves notices that were being issued 

to tribal members proposing to assert self employment tax on per capita 

distributions of net gaming revenues. Although we had developed specific 

language to describe these distributions on Forms 1040, our campuses were 

issuing notices that proposed to subject these reported payments to social 

security through the imposition of self employment tax. This is clearly 

erroneous. When it was raised to our attention, we took the following steps: 

• We contacted the Taxpayer Advocate Service who immediately 

intervened to correct the computer programming error that was 

causing the notices to be issued. 

• We posted information as the headline on our web site instructing 

tribes what action to take if tribal members received the erroneous 

notices. 

• We set up internal procedures to collect information from the 

tribes in regard to the notices and ensure the notices were 

promptly reversed. 

If you have experienced this issue, I apologize on behalf of the Service and I 

urge you to contact your assigned ITG Specialist so that we can resolve the 

matter. Although ITG cannot control every contact that originates from the 

Internal Revenue Service, we are committed to resolving unique problems that 

affect tribes and tribal members. 

Christie Jacobs 

....ITG is committed to 

resolving unique issues 

affecting tribes and 

tribal members.... 

IN THIS ISSUE 

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Message from the Director 

Tax Calendar for the 1st 

Quarter 2008 

Customer Satisfact

Survey Results Published 

Four Convicted for 

Conspiracy, Tax Evasion, and 

Theft from a Tribe 

2008 Standard M eage Rate 

Certain Payments to 

ed Veterans Ruled Tax 

How to Avoid an “Averaged” 

FTD Penalty 

IRS Trains AARP Tax Prep 

Volunteer Teachers 

Form 1099 M scel aneous 

Revised Form W-9 & LLCs 

Tax News For You! 

ITG Specialist Contacts 

Take advantage of SSA’s 

W-2 Online Services 
Federal Tax Calendar for First Quarter 2008 

January 2008 

Sun Mon Tue Wed Thu Fri Sat 

1 2 3 4 5 

* Make a deposit for * Make a deposit for 

12/26-12/28 12/29-1/1 

6 7 8 9 

Make a deposit for 

1/2-1/4 

10 

Employees report 

December tip income 

to employers if $20 

or more 

11 

* Make a deposit for 

1/5-1/8 

12 

13 14 15 16 17 18 19 

** Make a deposit * Make a deposit for * Make a deposit for 

for December if 

under the monthly 

deposit rule 

1/9-1/11 1/12-1/15 

20 21 22 23 24 25 26 

* Make a deposit for * Make a deposit for 

1/16-1/18 1/19-1/22 

27 28 29 30 31 

Issue W-2s, W-2Gs, 

* Make a deposit for and 1099s 

1/23-1/25 to recipients 

by January 31st. February 2008 

Sun Mon Tue Wed Thu Fri Sat 

1 2 

* Make a deposit for 

1/26-1/29 

3 4 5 6 7 8 9 

* Make a deposit for * Make a deposit for 

1/30-2/1 2/2-2/5 

10 11 12 13 14 15 16 

Employees report 

January tip income 

to employers if $20 

or more 

* Make a deposit for 

2/6-2/8 

* Make a deposit for 

2/9-2/12 

** Make a deposit for 

January if under the 

monthly deposit rule 

17 18 19 20 21 22 23 

* Make a deposit * Make a deposit for 

for 2/13-2/15 2/16-2/19 

24 25 26 27 28 29 File W-2s with SSA 

and 1099s with IRS 

* Make a deposit for * Make a deposit for by February 29th. 

2/20-2/22 2/23-2/26 

* = Make a Payroll Deposit if you are under the semi-weekly 2 NOTE: Deposits made through EFTPS must be initiated at least 

deposit rule. one day prior to the due dates listed above in order to be timely. 

**= Make a Monthly Deposit if you qualify under that rule. 
March 2008 

Sun Mon Tue Wed Thu Fri Sat 

1 

2 3 4 5 6 7 8 

* Make a deposit for * Make a deposit for 

2/27-2/29 3/1-3/4 

9 10 

Employees report 

February tip income 

to employers if $20 

or more 

11 12 

* Make a deposit for 

3/5-3/7 

13 14 

* Make a deposit for 

3/8-3/11 

15 

16 17 

** Make a deposit 

for February if under 

the monthly deposit 

rule 

18 19 

* Make a deposit for 

3/12-3/14 

20 21 

* Make a deposit for 

3/15-3/18 

22 

23 24 25 26 27 28 29 

* Make a deposit for * Make a deposit for 

3/19-3/21 3/22-3/25 

30 31 

* = Make a Payroll Deposit if you are under the semi-weekly deposit rule. NOTE: Deposits made through EFTPS must be initiated at least 

**= Make a Monthly Deposit if you qualify under that rule. one day prior to the due dates listed above in order to be timely. 

Return Filing Dates

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 January 2nd

File Form 730 and pay the tax on applicable wagers accepted during November 2007. 

 January 31st

File Form 941 for the 4th quarter of 2007. If all deposits are paid on time and in full, f e by February 11th. 

fied for simplified payroll f ng, file Form 944. If all deposits are ful y paid on time, f e by February 11th.

File Form 940 for 2007 if liab e for Federal Unemp oyment Tax (not participat ng or current with state 

unemployment tax). If all deposits are paid on time and in full, f e by February 11th. 

File Form 730 and pay the tax on applicable wagers accepted during December. 

File Form 945 for 2007. If all deposits are paid on time and in fu e by February 11th. 

File Form 943 for 2007 (agricultural entities). If all deposits are paid on time and in full, file by February 11th. 

February 28th

File information returns for all payments reported to recipients on Forms 1099, 1098, 5498, and W-2G, using 

 Form 1096 as a transmittal. If filing these forms electronically, f e by March 31st. 

February 29th

 File Form W-3, along with copy A of Forms W-2 you issued for 2007. File by March 31st if filng electronically. 

File Form 730 and pay the tax on applicable wagers accepted during January. 

 File Form 8027 if you are a large food and beverage establishment. File by March 31st if filing electronically. 

 March 31st

File Form 730 and pay the tax on applicable wagers accepted during February. 

3 
Customer Satisfaction Survey Results Published 

The Office of Indian Tribal Governments recently completed its fifth annual customer survey. The 

survey gave us feedback from our customers that allows us to measure customer satisfaction with our 

products and services and determine areas where we need to effect operational changes. 

We want to thank everyone who participated. We received 175 responses, which was slightly less 

than the prior year survey response rate. We are pleased that the overall level of satisfaction rose 

from 76% to 77%, but there were a number of issues surfaced where we are undertaking 

actions to address concerns raised in the survey. This includes, but is not limited to: 

• Continuing to develop specific materials for tribal members and tribal employees which 

explain tax issues that affect them 

• Further studying the causes of dissatisfaction in the Southwest and Pacific Northwest 

• Increasing education and outreach efforts with the Navajo Chapters 

• Monitoring work processes to improve responsiveness to tribal inquiries by ITG staff 

• Improving the clarity of examination letters, communicating future actions that might 

mitigate problems found during examinations, and improving the timeliness of actions 

taken by ITG during examinations 

This is the first survey where we have asked specific questions in regard to Compliance Checks and 

Examination interactions with ITG. Since examinations represent a significant percentage of the 

work done by ITG, we will focus extra efforts in regard to that specific feedback. 

Past analysis of the ITG customer base revealed similarities between the Alaska Native Villages and 

the Navajo Chapters. Both segments tend to be remotely located, have smaller government 

structures, few large business or gaming operations, and meager staff resources. It has been difficult 

to determine the needs and/or effect lasting solutions for these particular customers. In the past year, 

ITG implemented several initiatives in Alaska to increase our visibility and impact among the tribal 

villages. These improvements included purchasing copies of the tax/accounting software used by the 

villages to increase ITG understanding of reporting issues/problems arising from this software, adding 

a regional location code to the database so that work can be assigned geographically to minimize 

repeated travel to remote locations, and attending large state-run events for the Native Villages to 

distribute job-aids and information. In addition, ITG organized and conducted major payroll and 

information reporting educational seminars for tribal employees. The survey shows the positive results 

of these efforts. The customers in Alaska are now showing satisfaction rates comparable to the rest 

of the United States, while the Navajo Chapters are still reflecting much lower satisfaction. ITG will 

seek to apply best practices used in Alaska in a focused effort to better assist the Navajo Chapters. 

In addition to the overall measures, we also looked at satisfaction by geographic area and by 

common themes within the survey. The table on the following page shows that analysis, 

and compares the responses this year with the survey responses from the prior year. 

A more complete report on the survey is posted to our web site at www.irs.gov/tribes. We look 

forward to input at the ongoing Consultation Listening meetings to further assist in determining 

improvement opportunities. Future issues of ITG News will detail operational changes that we effect 

in response to the survey feedback. 

4 
Customer Satisfaction Survey Scores- by ITG Area 

Eastern North Central Southwest Western Pacific Northwest Alaska 

FY FY FY FY FY FY FY FY FY FY FY FY 

2006 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 2007 

Burden/ Delivery of Information 

Satisfied 83% 85% 72% 71% 56% 58% 76% 83% 82% 55% 57% 71% 

Neutral 9% 11% 21% 16% 26% 18% 16% 10% 15% 40% 29% 19% 

Dissatisfied 8% 4% 7% 13% 18% 23% 8% 7% 3% 5% 14% 10% 

Collaborate 

Satisfied 72% 72% 58% 65% 60% 57% 71% 68% 48% 39% 42% 62% 

Neutral 20% 24% 36% 24% 25% 24% 20% 18% 40% 48% 43% 29% 

Dissatisfied 8% 4% 6% 11% 15% 19% 8% 14% 12% 12% 15% 8% 

Recognition 

Satisfied 82% 84% 72% 70% 69% 59% 84% 77% 73% 50% 52% 69% 

Neutral 11% 14% 22% 23% 20% 34% 10% 13% 23% 36% 38% 24% 

Dissatisfied 8% 2% 5% 7% 11% 6% 5% 9% 4% 14% 10% 7% 

Protocol/ Horizontal Equity 

Satisfied 88% 82% 71% 90% 69% 66% 79% 83% 66% 57% 57% 72% 

Neutral 6% 14% 25% 9% 25% 27% 17% 12% 26% 31% 36% 23% 

Dissatisfied 5% 5% 4% 1% 6% 7% 3% 5% 8% 12% 8% 5% 

Accuracy/ Timeliness/ Honesty 

Satisfied 73% 69% 49% 65% 55% 51% 72% 74% 63% 47% 48% 61% 

Neutral 21% 25% 40% 27% 28% 33% 24% 10% 31% 41% 40% 32% 

Dissatisfied 6% 6% 11% 8% 18% 16% 4% 16% 6% 13% 12% 8% 

Overall Satisfaction 

Satisfied 88% 90% 78% 76% 73% 59% 86% 86% 85% 56% 59% 75% 

Neutral 4% 10% 22% 12% 15% 32% 8% 5% 8% 33% 33% 23% 

Dissatisfied 8% 0% 0% 12% 12% 9% 5% 8% 8% 11% 8% 2% 

Compliance Action - Overall Satisfaction 

Satisfied 67% 80% 86% 78% 43% 70% 

Neutral 17% 7% 0% 9% 33% 22% 

Dissatis- 17% 13% 14% 13% 24% 7% 

fied 

Compliance Action - Initial Meeting 

Satisfied 78% 95% 92% 90% 71% 87% 

Neutral 10% 3% 8% 1% 25% 12% 

Dissatis- 13% 3% 0% 8% 4% 0% 

fied 

Compliance Action - Subsequent Interactions 

Satisfied 74% 70% 80% 84% 56% 89% 

Neutral 17% 13% 0% 4% 36% 11% 

Dissatis- 9% 17% 20% 13% 8% 0% 

fied 

Compliance Action - Final Resolution 

Satisfied 68% 67% 67% 92% 43% 71% 

Neutral 12% 25% 7% 8% 43% 19% 

Dissatis- 20% 8% 27% 0% 14% 10% 

fied 

5 
Four Convicted for Conspiracy, Tax Evasion, and 

Theft from the Kickapoo Traditional Tribe of Texas 

In mid-October, a federal jury convicted Kickapoo Traditional Tribe of Texas gaming representative 

Isidro Garza, Jr., his son, former State Representative Timeteo Garza and Kickapoo Lucky Eagle 

Casino manager Arthur Lee Martin for scheming to steal over $2 million from the casino as well as the 

tribe itself. Isidro’s wife, Martha Garza, was convicted along with her husband and son of tax evasion 

and a related conspiracy charge. 

In all, the jury convicted: 

• Isidro Garza, Jr., of one count of conspiracy to commit theft from an Indian tribal 

organization and by officers and employees of Gaming Establishments on Indian lands, 

two substantive counts of theft from an Indian tribal organization, five substantive counts 

of theft by officers and employees of Gaming Establishments on Indian lands, one count of 

conspiracy to defraud the Internal Revenue Service, and four counts of tax evasion. As a 

result, Isidro Garza faces up to 55 years in federal prison. 

• Martha Garza of one count of conspiracy to defraud the Internal Revenue Service plus four 

counts of tax evasion. As a result, Martha Garza faces up to 25 years in federal prison. 

• Timeteo Garza of one count of conspiracy to commit theft from an Indian tribal 

organization and by officers and employees of Gaming Establishments on Indian lands, 

two counts of theft by officers and employees of Gaming Establishments on Indian lands, 

and one count of conspiracy to defraud the Internal Revenue Service. As a result, Timeteo 

Garza faces up to 20 years in federal prison. 

• Arthur Lee Martin of one count of conspiracy to commit theft from an Indian tribal 

organization and by officers and employees of Gaming Establishments on Indian 

lands, and two counts of theft by officers and employees of Gaming Establishments on 

Indian lands. As a result, Martin faces up to 15 years in federal prison. 

The jury found that between February 13, 1998, and October 28, 2002 the defendants misused tribal 

credit cards, took cash directly from the casino cash cage, and had checks from tribal and casino 

accounts written to pay for personal expenses. 

On May 17, 2007, Raul Garza, Sr., former chairman of the Kickapoo Traditional Tribe of Texas, was 

sentenced to three years in federal prison and ordered to pay more than $2 million restitution for his 

role in the scheme. 

ITG was instrumental in bringing this case forward for prosecution, and we remain committed to 

helping protect tribal assets for the benefit of tribal members by identifying financial abuses. We are 

pleased to partner with tribes in this regard, and although the outcomes can have short-term pain, 

the long term effect should make a clear statement that neither tribes nor the federal government will 

knowingly permit individuals to use tribal assets for their personal gain. 

Reporting Abuses/Schemes 

We continue to work with tribes and tribal officials to address financial abuses and schemes 

being promoted in Indian country. Working together can help ensure the integrity of tribal finances 

and eliminate the threats posed by individuals with schemes that appear “too good to be true” and often are. 

If you are aware of financial impropriety or of a promoter advocating a scheme that appears highly suspect, 

you can contact the ITG Abuse Detection and Prevention Team at (716) 686-4860 or via e-mail at 

tege.itg.schemes@irs.gov 

6 
2008 Standard Mileage Rate 

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Beginning January 1, 2008, the standard mileage rates for the use of a car (including vans, pickups or 

panel trucks) will be: 

50.5 cents per mile for business miles driven;

 19 cents per mile driven for medical or moving purposes; and

 14 cents per mile driven in service of charitable organizations.

These mileage rates are important to employers, such as Tribes, since the rates can be used to 

calculate reimbursements to employees who incur mileage on behalf of their employer under an 

Accountable Plan. 

The new rate for business miles compares to a rate of 48.5 cents per mile for 2007. The new rate for 

medical and moving purposes compares to 20 cents in 2007. The rate for miles driven in service of 

charitable organizations has remained the same. The standard mileage rate for business is based on 

an annual study of the fixed and variable costs of operating an automobile. 

Certain Payments to Disabled Veterans Ruled Tax-Free; 

Some May Be Due Refunds 

Payments under the Department of Veterans Affairs (VA) Compensated Work Therapy (CWT) program are 

no longer taxable and disabled veterans who paid tax on these benefits in the past three years can now 

claim refunds. 

Recipients of CWT payments will no longer receive a Form 1099 from the Department of Veterans 

Affairs. Disabled veterans who paid tax on these benefits in tax-years 2004, 2005 or 2006 can claim a 

refund by filing an amended return using IRS Form 1040X. According to the VA, more than 19,000 

veterans received CWT in Fiscal Year 2007. 

The IRS agreed with a U.S. Tax Court decision issued earlier this year, which held that CWT payments are 

tax-free veterans’ benefits. In so doing, the agency reversed a 1965 ruling which held that these payments 

were taxable and required the VA to issue 1099 forms to payment recipients. 

According to the VA, the CWT program provides assistance to veterans unable to work and support 

themselves. Under the program, the VA contracts with private industry and the public sector for work by 

veterans, who learn new job skills, re-learn successful work habits and regain a sense of self-esteem and 

self-worth. 

Employee Tip Income Program Questions 

ITG has a full-time Tip Coordinator to assist you with any questions about tip reporting agreements. 

If you are interested in securing a Tip Agreement, have questions concerning your existing 

agreement, or have received a notice about tip reporting responsibilities that is unclear, 

please contact Suzanne Perry at (602) 207-8254. 

7 
How to Avoid an “Averaged” Failure-To-Deposit Penalty 

IRS may assess an “averaged” failure-to-deposit (FTD) penalty of 2% to 10% if you are a monthly 

schedule depositor and did not properly complete the monthly liability section (Part 2) of Form 941 

when your total adjusted tax liability shown on Form 941 exceeded $2,500. 

IRS may also assess an “averaged” FTD penalty of 2% to 10% if you are a semiweekly schedule 

depositor and your total adjusted tax liability shown on Form 941 exceeded $2,500 and you: 

1. Completed the monthly liability section of Form 941 instead of Schedule B (Form 941), 

2. Failed to attach a properly completed Schedule B (Form 941), or 

3. Improperly completed Schedule B (Form 941) by, for example, entering tax deposits instead of 

tax liabilities in the numbered spaces. 

The average FTD penalty is computed by taking your total adjusted tax liability shown on Form 941 

and distributing it equally throughout the tax period. As a result, your deposits and payments may 

not be counted as timely because the actual dates of your tax liabilities cannot be accurately 

determined. 

An “averaged” FTD penalty can be avoided by reviewing your return prior to filing it. Follow these 

steps before submitting your Form 941: 

If you are a monthly schedule depositor, report your tax liabilities (not your deposits) in the 

monthly liability section (Part 2) shown on Form 941. 

If you are a semiweekly schedule depositor, report your tax liabilities (not your deposits) on 

Schedule B (Form 941) in the lines that represent the dates your employees were paid. 

Verify that your total liability on the bottom of Schedule B (Form 941) equals your total 

adjusted tax liability shown on Line 10 of Form 941. 

Do not show negative amounts in the monthly liability section Schedule B (Form 941). If 

your prior period correction results in a decrease to your tax liability, reduce your liability for 

the day that you discovered the error by the tax decrease resulting from the error, but not 

below zero. Apply any remaining decrease to subsequent liabilities. 

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Self-Assess Your Federal Tax Compliance Risks 

Tribal entities can now self-assess their federal tax compliance and work with ITG to address any problems 

they uncover. Entities electing to participate receive a fillable template from ITG and are provided with the 

name of a local ITG Special st who will serve as their resource during the process. 

Information on the program, as well as an on–line request form, are available through the “Enhancing Federal 

Tax Compliance” link on the right-hand side of the ITG web site landing page at www.irs.gov/tribes

or you can make an inquiry about the program via e-mail to tege.itg.tefac@irs.gov 

8 
IRS Trains Volunteer Income Tax Preparer Instructors 

The IRS recently held two training sessions about taxable and non-taxable income to individual Tribal 

members. The training was held in Boise, Idaho and Portland, Oregon. The one hour sessions were 

offered to AARP Tax-Aide Volunteer Instructors from Idaho, Oregon and southwest Washington. The 

information was provided so the volunteer instructors could go back and teach their tax preparation 

volunteers how to handle tax issues for Tribal members when filing electronic tax returns. Around 40 

volunteers attended the training in Boise, led by IRS Stakeholder Partnerships, Education and 

Communication Tax Consultant, Kim Boyack, while another 50 attended the Portland session led 

by Indian Tribal Governments Agent, Michael Fehrenbacher. 

Feedback from the participants was very favorable with lots of questions and answers throughout the 

sessions. Issues covered included the taxability and reporting of Per Capita payments, Tribal 

Council stipends, wages and tips, and non-employee compensation. Also covered were issues of 

non-taxable income from fishing - related activities under Internal Revenue Code section 7873 and 

possible non-taxable income from individually allotted lands, held in trust for the tribal members. 

Take Advantage of Social Security’s W-2 and W-2c Online Services 

W-2 Online 

For several years now, the Social Security Administration has offered an Online Business Services 

suite of wage reporting services. In 2002 it introduced the W-2 Online and in 2006 added W-2c 

Online. Both Online suites include support services. 

Saving and Resuming W-2 Online Reports 

W-2 Online only allows you to save W-2s that you have been working on for up to 90 days. Social 

Security will delete any saved reports that you do not submit or update within 90 days. Deleted W-2s 

in Business Services Online (BSO) cannot be retrieved. Saving your W-2s is not the same as submitting them to Social Security. 

So, if you started on your W-2s early and saved them, remember to return to BSO and submit any 

saved W-2s before the 90 days have passed, or they will be deleted. 

For more information visit www.socialsecurity.gov/employer/bsohbnew.htm 

Try W-2c Online! 

Dislike those dreaded paper W-2cs? Make your corrections online. Social Security’s W-2c Online 

will allow you to create, print and submit Forms W-2c directly over the Internet. Plus, W-2c Online 

is just as user-friendly as SSA’s other options in their suite of electronic services. Even if you file your 

wage reports using methods other than electronic filing, you may still use W-2c Online to make 

corrections to those wage reports. Best of all--it’s FREE! 

Visit www.socialsecurity.gov/employer, and choose “How to File.” Try it for yourself! 

9 
Form 1099-MISC: Reporting Payments to Non-Employees 

If a worker is not your employee, you are not liable for filing Form W-2 or any employment tax returns

with respect to that payee. However, in most cases, you are required to issue and file information returns, 

such as Form 1099-MISC, Miscellaneous Income, for amounts you pay in non-employee compensation.

What types of payments require me to issue Form 1099-MISC? You must issue Form 1099-MISC 

for each person to whom you have paid, in the course of tribal government business, at least $600 as

compensation for services. The form is also required to report rents, prizes and awards, medical and

health care payments, and attorney fees or gross proceeds to an attorney.

Examples of SERVICES normally requiring a Form 1099 MISC (if the business is not a corporation): 

You should secure a taxpayer identification number from recipients prior to making any reportable payments. 

You can use Form W-9, Request for Taxpayer Identification Number and Certification, for this purpose. See 

article on page 6 for further information on Form W-9.

Which payees should I issue Form 1099-MISC? You are required to report payments to individuals,

partnerships, estates, trusts, legal and medical service providers. If someone declares that they are a Limited 

Liability Company (LLC), you would issue them a Form 1099 unless they declare “corporation” as their tax

classification. If a LLC does not provide their tax classification, you should issue them a Form 1099. 

Are some payees exempt from the reporting requirements? 

State, local, and tribal governments are not required to issue Form 1099-MISC for payments to: 

· Tax-exempt organizations and governments 

· Vendors for merchandise, freight, storage, and similar items (but payments to vendors for services are 

reportable) 

· Corporations (other than attorney fees, medical and health care payments) 

· Rent to real estate agents 

· Recipients of scholarships 

· Recipients of difficulty-of-care payments 

When is Form 1099-MISC due? Make recipient copy available by January 31st of the year following the 

payment(s). You must send copies to IRS by February 28th. However, if you file electronically, the due date 

is March 31st. Penalties apply for late filing. 

What if Form 1099-MISC is not issued or is not correct? You may be subject to penalties for failure to 

file information returns or to furnish them to the recipients. Tribal government entities are not exempt from 

these penalties. In addition, if you fail to obtain a correct taxpayer identification number from the recipient, you 

will be required to withhold 28% from future payments. If you fail to backup withhold when required, you will 

be liable for the tax. 

Under what circumstances do I issue Form 1099-MISC to an employee? If someone meets the tests to 

be your employee, all compensation, benefits, reimbursements, etc., paid in the course of that work should be 

reported on Form W-2 and are subject to withholding. Only services as an independent contractor that are 

completely separate from employment would be reported on Form 1099-MISC. All compensation to a worker 

who is your employee under the common-law rules should be reported on Form W-2. 

See Instructions for Forms 1099, 1098, 5498, and W-2G, available at www.irs.gov, for further information. 

10 
Revised Form W-9 and LLCs 

i

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i Request for Taxpayer Identification Number and Certification is 

3) a partnership. 

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 i

 An LLC is always 

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Form W-9 is used by persons required to file informat on returns with the IRS to get the payee's correct 

name and Taxpayer Ident cation Number (TIN). For individuals, the TIN s generally a social security 

number (SSN). For bus ness, the TIN is generally an Employer Identif cation Number (EIN). 

A new revis on (Oct 2007) of Form W-9 

shown below. Please note that the boxes for entity types has been expanded. The form now requires a 

Limited Liability Company (LLC) to designate whether they are 1) a disregarded entity, 2) a corporation, or 

An LLC s a relat vely new entity created by state statute. The IRS did not create a new tax class cation for 

the LLC when t was created by the states; instead IRS uses the tax entity classifications it has always had 

for business taxpayers: sole proprietor (disregarded entity), corporation, or partnership. 

classified by the IRS as one of these types of taxable entities. A single member LLC that is a “disregarded 

entity” does not need an EIN and shou d use the name and taxpayer dentification number (TIN) of the 

ngle member owner for federal tax purposes. 

Form 1099 and LLC. If the completed Form W-9 returned from an LLC has dec ared that they are a 

“disregarded ent ty,” when you complete the r Form 1099, you must show the owner's name on the first 

name line. On the second name line, you may enter the LLC's name. Use the owner's TIN. Do not enter the 

disregarded entity's EIN when you complete their Form 1099. 

11 
Tax News For You!

Individual Tribal Member Information 

Make Filing Your Return a Less Taxing Experience This Year 

Beginning February 1 there will be tax preparation sites in your community that will prepare your return for you 

for FREE. To find a site close to you call IRS at 800.829.1040. IRS Certified Volunteers will make sure you get 

the tax credits you deserve like the Earned Income Tax Credit and the Child Tax Credit. You may qualify for 

these credits even if you owe no taxes! 

You may be able to take advantage of the IRS FREE FILE Program. FREE FILE allows you to prepare and e-file 

your return for free online if your income is $54,000 or less. To learn more go to www.irs.gov. 

You will need the following information to prepare your tax return or have your return prepared: 

 A copy of last year's tax return 

 Personal identification (driver's license, Social Security card or Individual Taxpayer Identification 

Number) for you and your spouse, if applicable, showing the SSN(s) or ITIN(s) 

 The Social Security or Individual Taxpayer Identification Numbers for your dependents, if applicable 

Income 

 W-2s from all of your employers 

 Forms 1099-INT showing interest paid to you throughout the year. 

 Form 1099-G showing any refund, credit or offset of state and local taxes. 

 All receipts pertaining to your small business 

 Forms 1099-DIV, 1099-R 

 Unemployment Compensation 

 Social Security benefits 

 Other Income 

Deductions such as: 

 Medical and Dental expenses 

 Receipts from taxes you paid such as state and local taxes, real estate taxes, personal property 

taxes. 

 Form 1098 for home mortgage interest and points 

 Receipts for charitable contributions and gifts 

 Casualty and theft losses 

 Job expenses 

 Education costs 

To get your refund faste,r choose Direct Deposit. You will need the Routing Transit Number and your Depositor 

Account Number from your checking, savings, or retirement account. 

Don't be overwhelmed; this list is just to help you get prepared and is not all-inclusive. If you have any 

questions about any of these items, call IRS at 800.829.1040. 

12 
ITG Area Contacts 

PACIFIC NORTHWEST 

SPECIALISTS 

360-696-7643 ext. 227 509-353-2842 

Michael.Fehrenbacher@irs.gov Melodie.F.Gren@irs.gov John.M.Mandeville@irs.gov 

Group Manager 

Jim McCabe 

l l

360-696-7643 ext 228 503-326-2381 

Telephone terne

• Call: Customer Account Services 877-829-5500 

• Visit: Web site at 

• Write: 

SE:T:GE:ITG 

1111 Constitution Ave., NW 

20224 

Alaska, Idaho, Oregon, Washington 

Michael Fehrenbacher Melodie Gren John Mandeville 

Vancouver, WA Spokane, WA Spokane, WA 

509-353-0824 

 Connie Perkins Joe W. Kincaid 

Vancouver, WA Sa em, OR Port and, OR 

503-399-5623 ext 251 

James.McCabe@irs.gov Connie.K.Perkins@irs.gov Joe.Kincaid@irs.gov 

, In t, & Mailing Address 

toll free 

Indian Tribal Governments www.irs.gov/tribes 

Internal Revenue Service 

Indian Tribal Governments 

 Washington, DC 

13