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degree of culpability, more than required writing, at the time of the transaction.80
The IRS has, for negligence or even recklessness.73 If the customer still does not provide
the TIN, the filer is required to make
in several cases, Incorrect or incomplete a follow-up annual solicitation on or
sought to assess Forms 8300 before Dec. 31 of the year in which the
Some further thoughts are worth adding
transaction occurred (or by Jan. 31 of the
the intentional about filing an incorrect Form 8300, following year for transactions occurring
disregard penalties including failing to include informa- in December).81 The annual solicitation
for repeated failures tion required by the form, which, as requires a formal request for the TIN
(including sending a Form W-9, Request
indicated above, can subject the filer to
to file or failures to civil and criminal penalties.74 Although for Taxpayer Identification Number and
include all required some errors or omissions can be deemed Certification, and a return envelope for
inconsequential,75 several errors are
written solicitations) as well as notifying
information. never considered inconsequential: failure the payer that he or she is subject to a
to obtain a TIN, failure to obtain a sur- $50 penalty imposed by the IRS for not
name of the payer, and failure to record furnishing his or her TIN.82 The filer
correct monetary amounts.76 To avoid must maintain contemporaneous records
Mistakes, sloppiness, and even lax proce- penalties, the filer must establish reason- showing the solicitations and provide
dures or a flawed compliance system do able cause for such failures.77 Reasonable them to the IRS upon request.83
not demonstrate voluntary or purposeful cause can be established if the taxpayer Providing an incorrect or incomplete
conduct rising to the level of intentional proves that significant mitigating factors annual statement can also subject the
disregard.70 Most importantly, prior excuse the failure or the failure arose due business to civil and criminal penalties
audit history is but one factor to con- to events beyond the taxpayer’s control.78 similar to those for incorrect or incom-
sider when assessing such penalties, but A failure to obtain the TIN of the plete Forms 8300.84
it is not conclusive as to a determination person from whom the cash is received
of intentional disregard.71 (or incorrectly recording the TIN) is Structuring
The courts have also been strongly a particularly sensitive issue. Custom- Sec. 6050I(f)(1) prohibits any person
influenced by the severity of the inten- ers may refuse to furnish their TIN, from causing or attempting to cause a
tional disregard penalties. As noted in especially if they are aware that a Form business to fail to file a Form 8300, file
Purser Truck Sales, Inc., the penalty for an 8300 is being filed with respect to the a Form 8300 that contains a material
intentional disregard violation increases transaction. This does not require that the omission or misstatement, or structure
exponentially as compared to the neg- filer refuse the cash payment; rather, in a transaction or assist in structuring a
ligence penalty (for 2021, a $280 negli- the case of missing or incorrect TINs, transaction to evade reporting require-
gence penalty per violation as compared reasonable cause can be established if ments. This includes setting up or
to $28,260 for intentional disregard).72 the filer makes at least two TIN solicita- helping to set up a transaction so that it
The penalties are extremely harsh, and tions of the payer.79 The filer must make appears a Form 8300 is not required.85
thus the courts have required a high an initial solicitation, either orally or in The civil and criminal penalties for

70. Purser Truck Sales, Inc., 710 F. Supp. 2d 1334 (M.D. Ga. 2008). 77. Sec. 6724.
71. Mycles Cycles, Inc., 18-CV-314 JLS (AGS) (S.D. Cal. 9/4/19), citing 78. Regs. Sec. 301.6724-1.
Purser Truck Sales and Kruse, Inc., 213 F. Supp. 2d 939 (N.D. Ind. 2002). 79. IRM §4.26.10.10.3.1(4)b.
72. Purser Truck Sales, Inc., 710 F. Supp. 2d 1334 (M.D. Ga. 2008). 80. Regs. Sec. 301.6724-1(e)(1). The filer can also note, in the comments
73. Id. section of the Form 8300, that the filer requested the customer’s TIN but
74. Regs. Sec. 1.6050I-1(g)(1). the customer refused to provide the requested information.
75. Regs. Sec. 301.6721-1(c)(1) defines an inconsequential error as “any 81. Id.
failure that does not prevent or hinder the Internal Revenue Service from 82. Regs. Sec. 301.6724-1(e)(2).
processing the return, from correlating the information required to be 83. IRM §4.26.10.10.3.1(6).
shown on the return with the information shown on the payee’s tax return, 84. Regs. Sec. 301.6722-1.
or from otherwise putting the return to its intended use.” 85. Publication 1544 (rev. September 2014).
76. Regs. Sec. 301.6721-1(c)(2).

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