In re Sand Rock Land Co.

Memorandum of Decision

ALAN JAROSLOVSKY, Bankruptcy Judge.

In 1984, debtor Sand Rock Land Company (“Sand Rock”) paid substantial interest income to two note holders. At that time, 26 U.S.C § 6049(a) required it to file a return (1099 form) setting forth the amount of interest paid to each payee. The form also required the payee’s tax identification number. If the payee failed to provide the number, 26 U.S.C. § 3406(a)(1)(D) required the person paying the interest to withhold 20 percent of the interest.

Sand Rock filed the required 1099 forms, but failed to include the payees’ identification…