[Code of Federal Regulations]
[Title 26, Volume 13]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 26CFR]

[Page 237-238]
 
                       TITLE 26--INTERNAL REVENUE
 
    CHAPTER I--INTERNAL REVENUE SERVICE, DEPARTMENT OF THE TREASURY 
                               (CONTINUED)
 
Procedure and Administration--Table of Contents
 
Sec.  1.6044-2  Returns of information as to payments of patronage dividends.

    (a) Requirement of reporting--(1) In general. Except as provided in 
Sec.  1.6044-4, every organization described in paragraph (b) of this 
section which makes payments with respect to patronage occurring on or 
after the first day of the first taxable year of the organization 
beginning after December 31, 1962, of amounts described in Sec.  1.6044-
3 aggregating $10 or more to any person during any calendar year shall 
make an information return on Forms 1096 and 1099 for the calendar year 
showing the aggregate amount of such payments, the name and address of 
the person to whom paid, the total of such payments for all persons, and 
such other information as is required by the forms. The organization is 
required to make an information return regardless of the amount of the 
payment if the tax imposed by section 3406 is required to be withheld. 
Thus, in the case of any amount subject to backup withholding under 
section 3406 and not refunded by the payor before the due date of the 
information return in accordance with the regulations under section 
3406, an information return shall be made even if the payment is not 
generally reportable because it is made to an exempt recipient described 
in Sec.  1.6049-4(c)(1)(ii) or the amount paid during the calendar year 
to the recipient aggregates less than $10.
    (2) Definitions. The term ``person'' when used in this section does 
not include the United States, a State, the District of Columbia, a 
foreign government, a political subdivision of a State or of a foreign 
government, or an international organization. Therefore, payment of 
amounts described in Sec.  1.6044-3 to one of these entities need not be 
reported.
    (3) Determination of person to whom a patronage dividend is paid. 
For purposes of applying the provisions of this section, the person 
whose identifying number is required to be included by the cooperative 
on an information return with respect to a patronage dividend shall be 
considered the person to whom such dividend is paid. For regulations 
relating to the use of identifying numbers, see Sec.  1.6109-1.
    (4) Inclusion of other payments. The Form 1099 filed by an 
organization with respect to payments of patronage dividends made to any 
person during a calendar year may, at the election of the organization, 
include other payments made by it to such person during such year which 
are required to be reported on Form 1099.
    (b) Organizations subject to reporting requirement. The 
organizations subject to the reporting requirements of paragraph (a) of 
this section are:
    (1) Any organization exempt from tax under section 521 (relating to 
exemption of farmers' cooperatives from tax), and
    (2) Any corporation operating on a cooperative basis other than an 
organization:
    (i) Which is exempt from tax under chapter 1 (other than section 
521), or
    (ii) Which is subject to the provisions of part II of subchapter H 
of chapter 1 (relating to mutual savings banks, etc.), or subchapter L 
of chapter 1 (relating to insurance companies), or

[[Page 238]]

    (iii) Which is engaged in furnishing electric energy, or providing 
telephone service, to persons in rural areas.
    (c) When payment deemed made. For purposes of this section, money or 
other property (except written notices of allocation) is deemed to have 
been paid when it is credited or set apart to a person without any 
substantial limitation or restriction as to the time or manner of 
payment or condition upon which payment is to be made, and is made 
available to him so that it may be drawn at any time, and its receipt 
brought within his own control and disposition. A written notice of 
allocation is considered to have been paid when it is issued by the 
organization to the distributee. Similarly, a qualified check (as 
defined in section 1388(d)(4)) is considered to have been paid when it 
is issued to the distributee.
    (d) Time and place for filing. The return required under this 
section on Forms 1096 and 1099 for any calendar year shall be filed 
after September 30 of such year, but not before the payer's final 
payment for the year, and on or before February 28 (March 31 if filed 
electronically) of the following year, with any of the Internal Revenue 
Service Centers, the addresses of which are listed in the instructions 
for such forms. For extensions of time for filing returns under this 
section, see Sec.  1.6081-1.
    (e) Cross-reference to penalty. For provisions relating to the 
penalty provided for failure to file timely a correct information return 
required under section 6044(a), see Sec.  301.6721-1 of this chapter 
(Procedure and Administration Regulations). See Sec.  301.6724-1 of this 
chapter for the waiver of a penalty if the failure is due to reasonable 
cause and is not due to willful neglect.
    (f) Magnetic media requirement. For the requirement to submit the 
information required by Form 1099 on magnetic media for payments after 
December 31, 1983, see section 6011(e) and Sec.  301.6011-2 of this 
chapter (Procedure and Administration Regulations). For rules relating 
to permission to submit the information required by Form 1099 on 
magnetic tape or other media, see Sec.  1.9101-1.

[T.D. 6628, 27 FR 12798, Dec. 28, 1962, as amended by T.D. 6677, 28 FR 
10147, Sept. 17, 1963; T.D. 6879, 31 FR 3493, Mar. 8, 1966; T.D. 6883, 
31 FR 6589, May 3, 1966; T.D. 8734, 62 FR 53476, Oct. 14, 1997; T.D. 
8895, 65 FR 50407, Aug. 18, 2000]