The Taxpayer First Act of 2019, enacted on July 1, 2019, has paved the way for potential new regulations regarding the requirements for filing 1099 forms. These regulations, if finalized, could significantly reduce the number of forms required for certain tax years. In this blog post, we will discuss the anticipated changes, the potential impact on filing requirements, and the importance of staying informed. Please note that the current requirement of 250 forms remains in effect until the regulations are officially issued.
Upcoming Changes: Reduction in Filing Requirements
The Taxpayer First Act grants the Department of the Treasury and the IRS the authority to issue regulations that lower the threshold for filing 1099 forms. The initial proposal suggests a reduction from 250 forms to 100 for the 2022 tax returns, followed by a further reduction to just 10 forms for the 2023 tax returns.
Staying Informed: IRS Updates and Notifications
It’s important to remain informed about any changes in regulations that may affect your filing requirements. The IRS acknowledges the potential adjustments and has stated that, once final regulations are issued, they will publish an article on IRS.gov to explain the specifics of the change. This resource will provide clarity on the revised filing requirements, ensuring that taxpayers are aware of their obligations.
Current Filing Requirement: 250 Forms
Until the new regulations are officially issued, the existing requirement of 250 forms per tax year remains in effect. This means that taxpayers are still obligated to file 1099 forms for 250 or more reportable transactions during a given tax year, as reflected in the current IRS publications.
Compliance and Penalties: Filing Electronically
It’s important to note that if you are required to file 1099 forms electronically but fail to do so without an approved waiver, you may be subject to penalties. Compliance with electronic filing requirements is crucial to avoid potential penalties and ensure timely submission of accurate information.
Potential changes to the filing requirements for 1099 forms are on the horizon, thanks to the Taxpayer First Act of 2019. While the regulations are still being finalized, it’s essential to stay informed about any updates issued by the IRS. Until the new regulations are officially implemented, the current requirement of 250 forms remains in effect. Compliance with electronic filing requirements is crucial to avoid penalties. Be proactive in monitoring IRS announcements and ensure that you stay up to date with any changes that may affect your filing obligations.