Employers: Accelerated Filing Deadlines for W-2s and 1099s in 2017

Published on December 22, 2016

One of the provisions in the Protecting Americans From Tax Hikes Act of 2015 (PATH Act) was to accelerate the filing deadline for Form W-2 and Form 1099-MISC. The new due dates take effect for the 2016 forms, which are due in 2017. 

The provision is aimed at reducing refund fraud connected to the reporting of employee and non-employee compensation through information returns like the W-2 and 1099. Thieves have been attempting to file fraudulent returns early in the tax season to claim refunds before the IRS has received and verified the data from employers. The new accelerated timeline will get the employer information to the IRS sooner, thereby helping to limit the opportunity thieves have to file fraudulent returns.

 

New W-2 filing dates

W-2 Filing Step

2016 Due Dates

2017 Due Dates

Recipient copy due to employee

January 31

January 31 (date remains the same)

Paper copy A due to Social Security Administration

February 28

January 31

Electronic copy A due to Social Security Administration

March 31

January 31

The penalties for not filing W-2s on time also increase with the PATH Act.

Filing Date

Fine Per W-2

W-2s filed up to 30 days late

$50

W-2s filed more than 30 days late

$100

W-2s filed after August 1 or not filed

$260

 New 1099-MISC filing dates

1099-MISC Filing Step

2016 Due Dates

2017 Due Dates

Recipient copy due to employee

January 31

January 31 (date remains the same)

Paper filing due to IRS

February 28

January 31

Electronic filing due to IRS

March 31

January 31

 The penalties for not filing Form 1099 on time remain unchanged.

Filing Date

Fine Per 1099

1099 filed up to 30 days late

$50

1099 filed more than 30 days late

$100

1099 filed after August 1 or not filed

$260

Keep in mind, the accelerated filing due dates for Form 1099 only pertain to Form 1099-MISC when reporting non-employee compensation payments in box 7. 

The due dates for the federal copies of 1099s used to report payments other than non-employee compensation will remain as February 28 for paper-filed returns and March 31 for electronically filed returns. 

New Safe Harbor Rules for De Minimis Errors

Since the forms must be filed to the IRS and the Social Security Administration on the same day they are due to employees, it is nearly impossible to make last-minute corrections before submission. However the PATH Act provides a safe harbor from penalties for failing to file correct forms or provide employees with correct statements. 

There are no penalties if the error is $100 or less, or $25 or less if the error is related to a tax withholding. You do not have to submit a corrected return to qualify for the safe harbor provision, but employees receiving W-2s or vendors receiving a Form 1099-MISC can ask you to provide applicable correction forms.

(Source: CliftonLarsonAllen – Manufacturing and Distribution Perspectives – November 22, 2016)