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IRS Tax Lien Notices (Form 668-Y & 668-Z): What AP Needs to Know
June 22, 2026
Q. We received a Notice of Federal Tax Lien (Form 668-Y(c)) and a Certificate of Release of Federal Tax Lien (Form 668-Z) from the IRS. This is the first time we've received these forms in Accounts Payable, and after asking around, no one knows what to do with them. The documents relate to liens against a few vendors we work with.
A.
(Answered by IOFM's third-party tax expert)
These payments still belong to your vendor under the beneficial owner rule. You do not send a 1099 to the lienholders.…
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