Jayco/Entegra Owners Beware!!!

[KahunaNomad]

Jayco/Entegra owners beware! As of this year, Jayco is requiring its customers to complete a W9 form for any reimbursement of service that was paid for upfront by the RV owners. Or, when parts are sent directly to the customers! The verbiage from customer service includes a possible issuance of a 1099 form! This is asinine garbage! I have NEVER heard of this practice being implemented by any other RV manufacturer. The purpose of the form W9 (from the IRS) is mainly for a 'contract' or 'working' relationship, where Jayco pays someone for contractual work! It's not for refund and/or reimbursement! I hope Jayco has lawyered up, because lawsuits will be coming!

[Scott91370]

I don't understand how they're going to do this if they haven't paid you for work and are just reimbursing your money.

[SloPoke]

Originally Posted by KahunaNomad

Jayco/Entegra owners beware! As of this year, Jayco is requiring its customers to complete a W9 form for any reimbursement of service that was paid for upfront by the RV owners. Or, when parts are sent directly to the customers! The verbiage from customer service includes a possible issuance of a 1099 form! This is asinine garbage! I have NEVER heard of this practice being implemented by any other RV manufacturer. The purpose of the form W9 (from the IRS) is mainly for a 'contract' or 'working' relationship, where Jayco pays someone for contractual work! It's not for refund and/or reimbursement! I hope Jayco has lawyered up, because lawsuits will be coming!

Can you share that document? ...of course, redact the personal info first!

[KahunaNomad]

Attached is the W9 form, and below is the reason I've been given from customer service:


[ As a matter of standard best business practice, our policy is to obtain a Form W-9 from any business or individual we are going to issue payments to, which allows us to verify the legitimacy of a business or individual we are doing business with. Failure to obtain a proper tax ID number when it’s actually required (for example if the issuance of a 1099 is required) can put us subject to fines and penalties with the IRS. Therefore, this is in essence a way to cover ourselves and limit the risk if we were ever under audit.]

Originally Posted by SloPoke

Can you share that document? ...of course, redact the personal info first!

[KahunaNomad]

My thought exactly. I'm wondering if this new policy is a tactic to reduce reimbursement amounts to we the owners? Thus, forcing us to go to dealers to get our rigs fixed?

Originally Posted by Scott91370

I don't understand how they're going to do this if they haven't paid you for work and are just reimbursing your money.

[Grumpy]

Originally Posted by KahunaNomad

My thought exactly. I'm wondering if this new policy is a tactic to reduce reimbursement amounts to we the owners? Thus, forcing us to go to dealers to get our rigs fixed?

It's probably because the Tax People have told them they need to. And 1099's only apply to labor amounts over $600 never did or will apply to parts.


The basic rule is that you must file a 1099-MISC whenever you pay an unincorporated independent contractor-that is, an independent contractor who is a sole proprietor or member of a partnership or LLC-$600 or more in a year for work done in the course of your trade or business by direct deposit or cash.

[KahunaNomad]

Yes, I do understand the basic rule of a 1099. Again, "I am" neither a contractor nor a vendor to Jayco. I am a customer who spent a few hundred thousand dollars and bought one of their Motor Coaches! If I spend my own money for a mobile tech to fix my rig, under warranty, I expect to be reimbursed accordingly. They would have already pre-approved the repairs and a copy of the invoice of items that were repaired as proof. So, explain to me how is this policy legal?

Originally Posted by Grumpy

It's probably because the Tax People have told them they need to. And 1099's only apply to labor amounts over $600 never did or will apply to parts.


The basic rule is that you must file a 1099-MISC whenever you pay an unincorporated independent contractor-that is, an independent contractor who is a sole proprietor or member of a partnership or LLC-$600 or more in a year for work done in the course of your trade or business by direct deposit or cash.

[Grumpy]

Originally Posted by KahunaNomad

Yes, I do understand the basic rule of a 1099. Again, "I am" neither a contractor nor a vendor to Jayco. I am a customer who spent a few hundred thousand dollars and bought one of their Motor Coaches! If I spend my own money for a mobile tech to fix my rig, under warranty, I expect to be reimbursed accordingly. They would have already pre-approved the repairs and a copy of the invoice of items that were repaired as proof. So, explain to me how is this policy legal?

If the Mobile Tech's name is on the INVOICE that is who they are paying for the work, albeit through you, as a 3rd party. That is what goes into their files showing who got paid. How much was the labor charge, over or under $600? To me that would be the cost they are concerned about.

I really doubt someone said "Hey send out a 1099 then we don't have to pay". Did you call and ask why?

[KahunaNomad]

LOL! Yes, of course I called them. But, the customer service rep told me outright that Jayco corporate didn't want to hear anymore complaints about this--and that was final! Maybe you can show me what other RV manufacturers are also implementing this policy on their owners? Also, I would appreciate seeing what IRS rule(s) Jayco is using to implement this policy?

Originally Posted by Grumpy

If the Mobile Tech's name is on the INVOICE that is who they are paying for the work, albeit through you, as a 3rd party. That is what goes into their files showing who got paid. How much was the labor charge, over or under $600? To me that would be the cost they are concerned about.

I really doubt someone said "Hey send out a 1099 then we don't have to pay". Did you call and ask why?

[morleyz]

I would bank on this being more of a KYC program than something tax related.

[Camper_bob]

The 1099s have changed. The ones for "contract labor" are now 1099-NEC forms, NOT 1099-MISC forms.

A 1099-MISC form can/will list an amount in "other income" that is a miscellaneous payment that the payer doesn't know how to classify. It's not "labor", so it can't go on 1099-NEC, and it doesn't fit any of the other 1099 reporting fields, so they drop it in "other" and let the taxpayer figure it out.

And let me assure you, you WILL have to figure it out. That 1099 you are issued will go to IRS, and if IRS doesn't see this "other income" reported on your tax return, you WILL get a letter "correcting" your return for the omission with fines and interest tacked on for good measure. And if you refuse to provide the information requested on the 1099, the payer is required to withhold a certain amount from the payment called "backup withholding".

The big problem is that individual customers are not businesses at all. There is no way to deduct this personal expense on your tax return to offset the "income" on the 1099.

In my professional opinion, this is a gross misuse of the 1099 reporting system. The payments Jayco makes for those items are warranty expenses for them. You should not ever be required to claim "warranty income" on your taxes unless it is in excess of the actual expense. You are not being "compensated", you are being reimbursed for an expense that was Jayco's responsibility in the first place. That's why they require receipts for your reimbursement.

Now, all of that being said, there's no provision for you to 1099 the individual or business who actually performed the repairs, which could create a "tax hole" (from the IRS perspective). If Jayco pays a contractor labor to fix something under warranty, they report that on 1099-NEC, which means the contractor MUST report that income to IRS. If Jayco pays YOU, and YOU pay the contractor, the IRS has no reporting of that income to the contractor, so the contractor could very well "omit" that income in their own tax reporting.

As a professional in the tax compliance industry, I'm intrigued at how all this will play out. I wonder if I could collect a W9 from my contractor and "nominee" the income reported by Jayco to them?

This has the potential to create some VERY interesting tax compliance issues!!

[TNORD]

I realize this is an old thread but I think I am seeing a pattern here. I have been waiting for over a year to be reimbursed for a battery (no issue from Jayco about the legitimacy of this claim). I was very concerned about giving my personal information to Jayco for a very small refund issue. I expressed that companies are being hacked daily and I did not see any reason for them to be stewards of my personal information for just a battery refund.
It has been six months since I provided that information and I followed up four or five times. Each time I get a promise to pay but the check never comes. It appears to me as though the W9 request is merely a ruse to get people to back off their claim for small reimbursements (which I almost did until I started to get suspicious). Anybody else out there give up on a minor reimbursement claim because of the hassle of trying to see it through?