Certified Regulatory Compliance Manager (CRCM) — Question 303

Which of the following interest-bearing accounts is EXEMPT from Form 1099 annual information reporting requirements under IRS regulations?

Answer options

• A. Time certificates of deposit
• B. Money market deposit accounts
• C. Individual retirement accounts
• D. Negotiable order of withdrawal accounts

Correct answer: C

Explanation

Individual retirement accounts (IRAs) are exempt from Form 1099 reporting requirements as they are intended for retirement savings and not regular income. In contrast, time certificates of deposit, money market deposit accounts, and negotiable order of withdrawal accounts are all considered taxable accounts and require Form 1099 reporting for interest earned.