Rev. Rul. 81-64

1981-1 C.B. 575, 1981-8 I.R.B. 69.

                       Internal Revenue Service
                                 Revenue Ruling

           INFORMATION RETURNS; BANKS; DEPOSITORS; INCORRECT ADDRESS

                          Published: February 23, 1981

26 CFR 1.6049-3: Statements to recipients of interest payments and holders of obligations to which there is attributed original issue discount

  Information returns; banks; depositors; incorrect address. A banking institution is not required by section 6049(C) of the Code to mail statements to depositors whose addresses are known to be incorrect, but the institution must make a reasonable effort to secure the correct addresses and be prepared to supply the statements when requested.

ISSUE

  Does section 6049 of the Internal Revenue Code require mailing statements to an address that is known to be incorrect?

FACTS

  X, a banking institution, maintains savings accounts that earn interest that X credits to the accounts.  Each calendar year, X files information returns and mails the corresponding statements to the savings account depositors.  Because of incorrect addresses, some of the statements are undeliverable.  X mails no statements to addresses known to be incorrect.

LAW AND ANALYSIS

  Section 6049(a)(1) of the Code provides that every person who makes payments of interest aggregating $10 or more to any other person during any calendar year shall make an information return as prescribed by the Secretary.

  Section 6049(c) of the Code provides that every person making a return under section 6049(a)(1) shall furnish to each person whose name is set forth in the return a written statement showing the name and address of the person making the return, and the amount of payments to, or the amount includible in the gross income of, the person shown on the return.

  The written statements required by section 6049(c) of the Code are generally furnished by mail.  Although some statements cannot be delivered to depositors because of incorrect addresses, the payor still has a responsibility to furnish statements to those depositors.  In those cases, the payor will satisfy this responsibility if it makes a reasonable effort to secure a correct address when there is a transaction in the account or other opportunity to do so, and if unable to effect delivery, is prepared to supply the statement when requested.

HOLDING

  Section 6049(c) of the Code does not require X to mail statements to addresses that are known to be incorrect.  However, X is required to make a reasonable effort to secure the correct address when there is a transaction in the account or other opportunity to do so, and to be prepared to supply the statement when requested.

Rev. Rul. 81-64, 1981-1 C.B. 575, 1981-8 I.R.B. 69.