You must notify the IRS if the successor of your merger will report tax data for both organizations using the successor’s name/federal tax ID number.
This is called the "combined reporting method".
If the combined reporting method will be used for your merger, complete and send this letter to notify the IRS: IRS Statement for Combined Reporting Letter.
If combined reporting will be used to report 1099 information, send the IRS letter by March 31.
If combined reporting will be used to report 5498 information, send the IRS letter by May 31.
Combined reporting may be used if:
- The successor acquires from the predecessor substantially all the property (a) used in the trade or business of the predecessor, including when one or more corporations are absorbed by another corporation under a merger agreement under which the surviving corporation becomes the owner of all the assets and assumes all the liabilities of the absorbed corporation(s); or (b) used in a separate unit of a trade or business of the predecessor.
- The predecessor is required to report amounts, including any withholding, on information returns for the year of acquisition for the period before the acquisition.
- The predecessor is not required to report amounts, including withholding, on information returns for the year of acquisition for the period after the acquisition.
Combined reporting agreement: The predecessor and the successor must agree on the specific forms to which the combined reporting procedure applies, and that the successor assumes the predecessor's entire information reporting obligations for these forms.