This blog was last updated on March 11, 2019
Changes to tax compliance requirements and legislation happen frequently at the state and IRS levels. In order to provide customers with the updated and accurate information they need, Sovos documents each of these changes in its Compass portal. Here are some notable changes in 1099 reporting from this week.
IRS Releases 2017 Version of Form 945 and Instructions to Form 945
The IRS recently released updated versions of both Form 945 and the Instructions to Form 945. While there are no substantive changes to the form, the Instructions establish new filing addresses for employers in Georgia, Illinois, Kentucky, Michigan, Tennessee, and Wisconsin. For employers who are not making payments while filing, all filings should be mailed to:
Department of Treasury
Internal Revenue Service
Kansas City, MO 64999-0058
For employers who are making a payment with their filing, all filings should be sent to:
Internal Revenue Service
P.O. Box 8004525
Cincinnati, OH 45280-4524
Additionally, the IRS announced that the filing date for Form 945 is February 12, 2018. The IRS notes that envelopes received after this date shall be considered timely so long as the envelope is properly addressed, contains sufficient postage, and is postmarked by the United States postal service or IRS-designated private delivery service (PDS) on or before the filing date.
To read the instructions in their entirety, please follow the link below.
IRS Releases Updated Version of Instructions for Form 3921 and Form 3922
The IRS recently updated the Instructions for Forms 3921 and 3922. The instructions state that filers may truncate a recipient’s TIN on payee statements. However, truncation is not allowed on any documents the filer files with the IRS. The payer’s TIN may not be truncated on any form. To read the instructions in their entirety, please follow the link below.
IRS Releases Updated Version of Form 3921
The IRS recently published an updated version of Form 3921. The new form permits TIN truncation of a payee’s TIN in the copy of the form that is provided to employees. However, TINs may not be truncated when submitting the form to the IRS. Additionally, Copies B, C, and D of Form 3921 have been made fillable on-line in the PDF format.
To view the new form, please follow the link below.
IRS Releases 2017 Publication 6961, Estimates Decrease in Number of Forms Filed in Calendar Year 2018
The IRS has released Publication 6961, and there is some new information provided in this revision:
- For Calendar Year (i.e. Filing Year) 2018, the grand total number of information and withholding documents projected in this update is about 4.9 percent less than the total volume projected last year.
- A major portion of the net revision is driven by the decrease in the projections of Form 1099-B and Form 1099-DIV.
- These downward revisions are in response to the actual CY 2016 and year-to-date (mid-July) CY 2017 filing experiences
- For paper submissions of IRP documents, the CY 2018 estimate is about 0.2% less than the paper volumes projected in last year
To view Publication 6961, please click the link below.
Congress Currently Discussing New Bill That Alter Thresholds for Forms 1099-MISC and 1099-K
Congress is currently discussing HR3717, the “Small Business Owners’ Tax Simplification Act of 2017.” The purported aim of the bill would be to avoid unduly burdening small business owners and to improve compliance. The bill would seek to accomplish through changing the reporting thresholds of both Form 1099-MISC (something that hasn’t been done since 1954) as well as Form 1099-K.
In particular, this bill would raise the reporting threshold for Form 1099-MISC from $600 to $1500 Additionally, it would add an inflation adjustment aspect to the threshold, beginning in 2019 at the earliest, that would increase the threshold by an amount equal to “such dollar amount, multiplied by the cost of living adjustment for the calendar year in which the taxable year begins.” To make it easier, the bill would also introduce a rounding requirement that if the threshold amount was not equal to a multiple of $100 that the amount would be rounded to the nearest multiple of $100.
The bill would also both lower the reporting threshold amount of Form 1099-K to $1500 and eliminate the reporting threshold for the form. Currently, Form 1099-K has a $20k and 200 transaction threshold for all third-party network payments (although this threshold does not apply to payment card payments). The passage of this bill would serve to reduce the reporting gap on Form 1099-K that some analysts have noted.
The bill is currently being discussed in the House Ways and Means committee and has obtained bipartisan support.
To view the bill, please click below.
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