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First, this is not meant to be legal or tax advice. Second, I present this information to you to give you a greater
understanding of how this remedy works so you can make your own decision as to how to proceed.

Advocates of the 1 – OID method will argue that it is best not to notify the banks of what you are doing, i.e. do not
send them any 1099 copies that you had filed with the IRS. The justification being that they have been stealing our
credit all these years and not notifying us. Per IRS Publications, it is the entity whose name appears in the upper left
hand box of any given 1099 that is supposed to be the filer. Do you have power of attorney to file for the bank? Are
you an authorized representative of the bank and as such given permission to file 1099’s for them?

Can we get the bank to file the proper 1099’s for us to recover our credit? If not, how can we get it done and stay in
honor and not risk future repercussions?

Per IRS Publications - if someone is a 'Holder' of OID debt instruments and receives an OID that includes
amounts belonging to someone else, then the ‘Holder’ is considered a RECIPIENT NOMINEE. When a
RECIPIENT NOMINEE receives their copy of the 1099OID (we filed as PAYER), they now have a
requirement to file a 1099OID showing them as the PAYER and the true Owner of the debt instrument as the

From the instructions for form 1099OID:

“Exceptions. You are not required to file Form 1099-OID for payments made to certain
payees, including a corporation…”

Therein lays their little secret. Not only is there no requirement for you to file these 1099OID’s, they are hoping you
do not… because if you do not, that’s a big THANK YOU…. for the GIFT! Because, that is what you have just
given them by not filing.

According to the information in the IRS publications, once YOU file the first 1099OID as PAYER, with the bank as
RECIPIENT NOMINEE, the bank is now under an obligation to file the 2nd 1099OID showing your ALL CAPS
NAME as RECIPIENT and their name as PAYER…. but the bank has no obligation to file until we file the
1099OID naming them as RECIPIENT NOMINEE. Now, in a perfect world where everyone operates in honor,
once you took care of your filings and the bank did theirs you would get a refund without hassles.

Unfortunately, we do not live in a perfect world. We are dealing with a banking industry that is full of dishonor and
has been hijacking our credit and labor energy and those that came before us for centuries. So, the issue becomes
what to do if and when the bank fails to or declines to file this 2nd 1099OID.

Here is how it works.

File the 1st 1099OID with your ALL CAPS NAME as PAYER and bank as RECIPIENT NOMINEE and a 1099A.
You will send a cover letter to the bank explaining what you want them to file along with their copy of the filed
1099A, their copy of the filed 1099OID with them as RECIPIENT NOMINEE and an unfiled draft copy of the 2nd
1099OID showing the bank as PAYER and your ALL CAPS NAME as RECIPEINT and tell them that draft is a
copy of the exact 1099OID they should file with the IRS. Among other things the letter will go on to say that if they
do not file the 1099OID with their name as PAYER and your ALL CAPS NAME as RECIPIENT within, let's say,
10 days or 14 days of receipt, then their silence is their agreement to have you file it for them. This letter will need
to be sent with some type of delivery confirmation so you can confirm the exact date it was received in their offices.
A courtesy copy of this letter can also go to the IRS giving them a heads up to look for a filing from the bank
as NOMINEE or a filing from you due to the banks dishonor. You may also choose to use a Notary as part of the

In commerce, silence is acquiescence… meaning, if they do not file the 1099OID then by their silence they are
agreeing to have you file it for them. It is important to have this paper trail created if your administrative process is
ever called into question as to why you did what you did. You can show you stayed in honor while they did not.
Therefore, the procedure would be:


(1) 1099A - your NAME as LENDER, bank as BORROWER

(2) 1099OID - your NAME as PAYER, bank as RECIPIENT NOMINEE


(1) Cover letter explaining why you filed the 1099’s and their duties and obligations and what will happen should
they act dishonorably and fail to perform as stipulated in the letter

(2) Banks copy of 1099A

(3) Banks copy of 1099OID

(4) Draft copy of 1099OID (bank as Payer) showing bank what they should file with IRS

SECOND OID FILING – (Should the bank fail to file the 1099OID per your instructions)

(1) 1099OID showing bank as PAYER and your NAME as RECIPIENT


(1) Send a copy of the newly filed 1099OID to the bank(s)

(2) Cover Letter


(1) Submit return to IRS

In Commerce we are dealing with Debtors and Creditors and those who play accessory or supporting roles. In
Commerce we are dealing with Honor and Dishonor. To be a Creditor is to stay in honor. Strictly speaking, it is not
honorable to file a 1099OID for the bank (as PAYER) until you get them in a dishonor, which is what you do filing
the way I have described above.

PLEASE NOTE: For those of you who are still 1099ing credit cards - Some credit card companies have reacted to
the NOTICE by sending intimidating letters and canceling credit cards... that is if you 1099'ed the credit card
account you have with them. If you send the NOTICE out to the credit card company you might want to make it
clear that you are not intending to stop making your credit card payments nor are you in any way attempting to get
out of the credit card debt you might have with them.

Folks who are 1099ing personal checking accounts are also getting letters from banks, sometimes phone calls. In
general, understand there is a difference between a response and a non-response. When the bank may reply, do they
respond to your NOTICE? In order to qualify as a 'response' they must address the questions you posed in the
NOTICE. If they do not, it is a non-responsive reply.

Let me know if you have any questions on this and how you would like to proceed.

Regards, Ron