TIN Mismatch Statistics: 2026 Report

If you file information returns, one incorrect taxpayer identification number can lead to an IRS notice and, depending on the circumstances and how the payer responds, backup withholding requirements and information-return penalties that can apply separately to the return filed with the IRS and the statement furnished to the recipient. This report pulls together what federal audits show about how widespread TIN errors are, how much required withholding goes uncollected, and what the 2026 penalty schedule means for your filings, so you know where the risk sits before your next filing season.

In October 2026, our research team compiled TIN mismatch statistics from two Treasury Inspector General for Tax Administration (TIGTA) audits of payer backup withholding compliance, the IRS penalty schedule in effect for returns due in 2026, and IRS filing volume projections through Tax Year 2032 (returns reported in calendar year 2033). The analysis covers the volume of information returns with missing or incorrect taxpayer identification numbers (TINs), the backup withholding obligation those errors create, and the penalty exposure that follows when errors go uncorrected. We didn't find a consolidated IRS-published annual TIN error rate covering all information return types; the most specific government-published figures available come from the TIGTA audits described below. Tax Year 2025 forms are filed in early 2026, and all penalty figures in this report apply to those returns.

TIN Mismatch Scale: Returns and Payers Affected

The two TIGTA audits give detailed government-published figures for the payer populations they examined. TIGTA reviewed Tax Year 2013 returns in its 2016 report (Ref. No. 2016-40-078) and Tax Year 2018 returns in its 2021 follow-up (Ref. No. 2021-40-030). Both looked at missing TINs and incorrect TINs, but the 2016 headline used a two-year repeat subset for missing TINs. In both reports, the incorrect-TIN analysis focused on the same incorrect TIN reported for four consecutive years. So the combined figures below aren't a consistent time series.

The TIN Mismatch Scale: TIGTA Audit Findings

* TY 2013 estimates use the 28% backup withholding rate that applied at the time. ** TY 2018 estimates use the 24% rate effective January 1, 2018. These are TIGTA estimates, not assessed liabilities or confirmed collectible amounts. IRS management noted that individual circumstances can affect whether withholding applies and whether relief is available. These historical TIGTA audit populations provide insight into the scale and consequences of persistent TIN problems, but they should not be interpreted as a current national TIN mismatch rate.

Research findings:

The TIGTA 2016 report's headline for Tax Year 2013 was that nearly $9 billion in backup withholding wasn't withheld as required. That figure combines the two subsets in the table: nearly $4 billion tied to the two-year missing-TIN subset and nearly $5 billion tied to the four-year incorrect-TIN subset. Separately, the IRS notified payers about 10.8 million of the more than 18.9 million TY 2013 returns it had identified with missing or incorrect TINs, or 57% of that population.

For Tax Year 2018, TIGTA identified 182,075 payers and 440,404 returns with missing TINs or four-year repeat incorrect TINs. It estimated that $13.3 billion in backup withholding was required on $55.6 billion in reported payments. In the four-year repeat incorrect-TIN population, returns fell from 203,751 to 173,787 between TY 2013 and TY 2018, a drop of roughly 15%. TIGTA estimated nearly $2.8 billion in required withholding on the TY 2018 incorrect-TIN returns, with about $2.6 million actually withheld.

TIGTA also identified two groups of payers that together accounted for about $728 million in estimated additional backup withholding: five payers with missing TINs and eight more payers with over 1,000 returns involving missing or incorrect TINs. That figure is an audit estimate, not an IRS assessment or a confirmed collectible amount.

2026 Penalty Rates for TIN Errors on Information Returns

Penalties for incorrect or missing TINs can apply under Internal Revenue Code (IRC) Section 6721 to information returns filed with the IRS and under Section 6722 to payee statements furnished to recipients. The IRS applies the two provisions separately, so a single TIN error can create exposure under both when it causes both failures.

The TIN Error Penalty Structure: Returns and Statements Due in 2026

* The intentional-disregard penalty can be higher under applicable statutory rules. Small-business maximums generally apply when average annual gross receipts for the three most recent tax years are $5 million or less. The table shows the IRS's general 2026 schedule; exceptions and relief depend on the facts.

Research findings:

The correction period is measured from the relevant filing or furnishing deadline, not from receipt of a CP2100/CP2100A notice. For example, the general federal filing deadline for TY 2025 Forms 1099-NEC and W-2 was February 2, 2026, and the general electronic filing deadline for many other Forms 1099 was March 31, 2026. Filing and payee-statement deadlines can differ by form.

IRC §6721 includes a de minimis correction exception for a limited number of information returns when specific conditions are met, including timely filing and correction by August 1. The limit is the greater of 10 returns or 0.5% of the information returns the filer must file for the calendar year. The exception has eligibility restrictions, including some based on the return's due date, and it isn't an IRS estimate of an acceptable TIN error rate. Reasonable-cause relief under IRC §6724 may also be available.

Notice 972CG proposes a penalty under IRC §6721; it isn't an assessment in itself. A filer generally has 45 calendar days from the notice date to respond, or 60 calendar days for a foreign filer. A filer seeking reasonable-cause relief must provide the required written explanation and supporting details, and the IRS decides whether relief applies.

TIN Error Categories and Payer Obligations

IRS CP2100 and CP2100A notices identify payee TINs that are incorrect on the information returns a payer filed. The steps a payer must take depend on the error category and the account's history. For incorrect name/TIN combinations, whether the First or Second B Notice process applies depends on the account's notice history and IRS rules.

The TIN Error Category Reference

Publication 1281 provides further rules, including cases where two notices received in the same calendar year don't call for a Second B Notice.

Research findings:

For missing TINs, backup withholding generally begins on reportable payments without waiting for a CP2100/CP2100A notice. The payer must make the applicable initial and annual solicitations to support a reasonable-cause request, though completing the solicitations alone doesn't guarantee penalty relief.

For a First B Notice, the payer sends the notice and Form W-9 within 15 business days of the later of the CP2100/CP2100A notice date or receipt date. If a signed Form W-9 isn't received, withholding must begin no later than 30 business days after that later date. Once the signed Form W-9 arrives, the payer must stop withholding within 30 calendar days.

For a Second B Notice, a self-certified Form W-9 isn't enough. Publication 1281 describes the required validation: for an SSN, a Social Security card meeting its stated requirements; for an EIN, IRS Letter 147C; for an ITIN, IRS Letter 685C; and for an ATIN, IRS Letter 096C. See the publication for the complete procedures.

Information Return Volume and the Scale of TIN Risk

The IRS reported approximately 4.60 billion information and withholding documents for Tax Year 2024, reported in calendar year (CY) 2025, and projects approximately 7.39 billion for Tax Year 2032, reported in CY 2033. Not every document in this population is subject to TIN matching or backup withholding.

Information Return Volume by Tax Year: 2026 Report

The CY 2026 IRS projection (TY 2025 returns) includes Form 1099-DA and reflects actual cumulative weekly filings through June 30, 2026. Most of the increase from Tax Year 2024, reported in CY 2025, to Tax Year 2025, reported in CY 2026, comes from Form 1099-DA, which is new to the IRS tables; the IRS projects about 1.33 billion 1099-DA documents in CY 2026, based on limited preliminary filing data.

Research findings:

We didn't find a consolidated IRS-published annual TIN error rate covering all information return types. The TIGTA audits examined defined populations and don't establish an overall annual mismatch rate.

IRS projections show information and withholding document volume rising from about 4.60 billion for Tax Year 2024 (reported in CY 2025) to about 7.39 billion for Tax Year 2032 (reported in CY 2033), an increase of roughly 61%.

IRS research documents the link between information reporting and tax compliance. In its Tax Year 2022 tax gap projections, the IRS cited TY 2014–2016 analysis showing a net misreporting percentage of about 1% for income subject to substantial information reporting and withholding, including wages, compared with 55% for income subject to little or no information reporting, a category that includes nonfarm proprietor income. The categories differ in many ways, so these figures don't measure the effect of TIN mismatches alone.

See more 1099 filing statistics.

Requesting a Copy of This Report

If you'd like a PDF copy of this report or want to learn how Yearli supports TIN matching before you file, please contact Yearli.

Yearli Performance and Yearli Premier include unlimited TIN matching at no additional cost, and Yearli Core offers TIN matching on a paid, per-use basis. TIN matching can help identify certain name/TIN inconsistencies before filing, but a match doesn't establish that every aspect of a filing is correct or eliminate the possibility of an IRS notice, backup withholding obligation, or penalty.

Sources

1. Yearli by Greatland. TIN Mismatch Statistics: 2026 Report. October 2026.
2. Treasury Inspector General for Tax Administration. Backup Withholding Noncompliance and Underreported Employment Taxes Continue to Contribute Billions of Dollars to the Tax Gap. Ref. No. 2021-40-030. May 17, 2021.
3. Treasury Inspector General for Tax Administration. Due to the Lack of Enforcement, Taxpayers Are Avoiding Billions of Dollars in Backup Withholding. Ref. No. 2016-40-078. September 14, 2016.
4. Internal Revenue Service. Information Return Penalties. Rates for returns and statements due in 2026.
5. Internal Revenue Service. Publication 6961: Calendar Year Projections of Information and Withholding Documents. Rev. 9-2026.
6. Internal Revenue Service. Publication 1281: Backup Withholding for Missing and Incorrect Name/TIN(s). Rev. 12-2023.
7. Internal Revenue Service. Publication 1586: Reasonable Cause Regulations and Requirements for Missing and Incorrect Name/TINs. Rev. 8-2026.
8. Internal Revenue Service. Understanding Your CP2100 or CP2100A Notice.
9. Internal Revenue Service. Publication 5869: Tax Gap Projections for Tax Year 2022. Rev. 10-2024.