The IRS issued a new filing deadline for 1099-MISC and W-2 forms for 2016. In the past, 1099-MISC forms and W-2 forms were required to be mailed out to recipients by January 31st. The business deadline to file with the Social Security Administration was not until the end of February and you could file an extension. This led to some tax fraud as you can imagine. Many people would file taxes between the time that the 1099-MISC and W-2 forms were issued and when the SSA received the information from businesses.
Why the new filing deadline?
Previously, some people who were aware of this discrepancy between filing dates would file returns with false W-2 information. This would result in fraudulent returns issued to these early filers. Once the refunds were issued the federal government would need to “chase” these taxpayers for amended returns. In the past, employers/business owners had until as late as the end of March to file. Now, all employers/business owners have to file all forms with the SSA by January 31st. You can still get a 30-day extension, but it is no longer automatic and must be filed by January 31st.Form 8809 Application for Extension of Time to File Information Returns must be filed as soon as possible. Please carefully read the instructions for the form for more information.
How will this impact refunds?
Some refunds will be automatically held until at least February 15th. Returns that include claims for the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) will automatically be held until Feb 15th under the new PATH act change. Please visit the IRS website for more information about the new changes. This post covers the general information regarding the changes but you should visit the IRS website for complete information.
While talking about taxes and filing deadlines is no one’s favorite topic, it is important for your business to be in compliance. Being aware of deadlines or having a trusted advisor to keep track of them for you is invaluable. Sign up here if you would like to be added to our mailing list for future updates.