SEC. 2. NATURE OF CHANGES

were added. The box numbers and titles are as follows:

• Box 1, IRA contributions (other than

amounts in boxes 2,3 and 7-10)

• Box 2, Rollover contributions

• Box 3, Roth conversion amount

• Box 4, Fair market value of account

• Box 5, Life insurance cost included

in box 1

• Box 6, Check boxes for: IRA, SEP,

.01 The title of this publication has been changed by eliminating the word “Series”. The new title is “Rules and Specifications for Private Printing of Substitute Forms 1096, 1098, 1099, 5498 and W–2G”.

.02 Two new forms were developed for tax year 1998. They are Form 1098–E, Student Loan Interest Statement (Exhibit B); and Form 1098–T, Tuition Payments Statement (Exhibit C).

.03 Form 1099–DIV, Dividends and Distributions, has been completely revised. Box 1a, Gross dividends and other distributions on stock, was eliminated. The heading “Liquidation Distributions” above boxes 5 and 6 was eliminated. The new boxes and their titles are as follows:

SIMPLE, Roth IRA, Roth conversion, Ed IRA

• Box 7, SEP contributions

• Box 8, SIMPLE contributions

• Box 9, Roth IRA contributions

• Box 10, Ed IRA contributions .05 Forms 1098–E, 1098–T and 1099–LTC have been added to the list of forms in Part A, Section 7.03(3) that require a telephone number on recipients’ statements.

.06 The IRS mailing address in Part A, Sec. 3.01 has changed as follows:

Internal Revenue Service Attn: IRP Coordinator, T:FS:S:P:S 5000 Ellin Road Lanham, MD 20706 .07 A procedure was added which allows you to reverse the location of the policyholder’s and insured’s name, street address, city, state, and ZIP code for ease of mailing on Copy C of Form 1099– LTC. See Part A Section 3.02 and Section 7.03 (10). .08 Procedures were added in Part A Section 7.03(9) which allows states to include an additional box(es) on substitute recipient statements for use by the state.

.09 The exhibits at the end of this publication have been realigned to include new Forms 1098–E and 1098–T.

• Box 1, Ordinary dividends

• Box 2a, Total capital gain distr.

• Box 2b, 28% rate gain

• Box 2c, Unrecap. sec. 1250 gain

• Box 2d, Section 1202 gain

• Box 3, Nontaxable distributions

• Box 4, Federal income tax withheld

• Box 5, Investment expenses

• Box 6, Foreign tax paid

• Box 7, Foreign country or U.S. pos

SEC. 3 REQUIREMENTS FOR ACCEPTABLE SUBSTITUTE FORMS 1096, 1098, 1099, 5498, and W–2G

.01 Paper substitutes for Form 1096 and Copy A of Forms 1098, 1099, 5498, and W–2G that totally conform to the specifications contained in this revenue procedure may be privately printed and filed as returns with the IRS. The reference to the Department of the Treasury Internal Revenue Service should be included on all such forms. If you are uncertain of any specification set forth herein and want that specification clarified, you may submit a letter citing the

session

• Box 8, Cash liquidation distr.

• Box 9, Noncash liquidation distr. .04 Form 5498 was retitled “IRA Contribution Information”; several box titles were changed; and several new boxes

1998–26 I.R.B. 7 June 29, 1998

specification in question, giving your understanding and interpretation of the specification, and enclosing an example of the form (if appropriate) to:

Internal Revenue Service ATTN: IRP Coordinator – T:FS:S:P:S 5000 Ellin Road Lanham, MD 20706 NOTE: Allow at least 45 days for the IRS to respond.

.02 Copy B (Form 1098 – For Payer, Form 1098–E – For Borrower, Form 1098–T - For Student, Form 1099–A For Borrower, Form 1099–C – For Debtor, Form 1099–LTC – For Policyholder, Form 1099–S – For Transferor, Other Forms 1099 – For Recipient, Forms 5498 and 5498–MSA - For Participant, and Forms W–2G and 1099–R – To Be Attached To the Federal Income Tax Return); and Copy C- (Form 1099–R – For Recipient’s Records, Form W–2G – For Winner’s Records and, Form 1099–LTC – For Insured) must contain the information specified in Part A, Section 7 in order to constitute a “statement” or “official form” under the applicable provisions of the Internal Revenue Code. The format of this information is at the discretion of the filer with the exception of the location of the tax year, form number and form name specified in Part A, Section 7.01(6) and 7.03(1) and composite Form 1099 statements specified in PART A, Section 7.02. Note: On Copy C, Form 1099–LTC, you may reverse the location of the policyholder’s name, street address, city, state, and ZIP code with the location of the insured’s name, street address, city, state, and ZIP code for ease in mailing.

.03 Forms 1096, 1098, 1099, 5498, and W–2G are subject to annual review and possible change. Therefore, filers are cautioned against overstocking supplies of privately printed substitutes. THE SPECIFICATIONS CONTAINED IN THIS REVENUE PROCEDURE APPLY TO 1998 FORMS ONLY.

.04 Proposed substitutes for Copy A that do not conform to the specifications in this revenue procedure are not acceptable. Further, if you file such forms with IRS, you may be subject to a penalty for failure to file an information return under section 6721 of the Internal Revenue Code (IRC). Generally, the penalty is $50 for each failure to file a form (up to $250,000) that the IRS cannot accept as a

return because it does not meet the provisions in this revenue procedure. No IRS office is authorized to allow deviations from this revenue procedure.