Be Prepared for New IRS Filing Deadlines
As the 2016 year-end approaches quickly, it is vitally important that all companies make preparations for the new IRS filing deadlines.
For the first time in history, the IRS is requiring that both W2s and 1099s (when reporting payments in Box 7) be submitted to the Social Security Administration (SSA) and IRS by January 31st, 2017.
The IRS Revenue Procedure 2016-55 now contains penalties that your A/P department will face if you do not accurately comply with this deadline. In previous years, the filing deadline for employers was the end of February, or even the end of March, if filing electronically. Not only did you have more time, you also didn’t have new penalties for delays and inaccuracies to worry about.
The new penalties for incorrect filings recently announced by the IRS are drastic. Take a look at the new maximum penalties:
- Incorrect 1099 = $260 each, with a new maximum penalty of $3,218,500
- 1099 corrected 30 days after the required deadline = $50, new max penalty of $536,000
- 1099 corrected before August 1st, 2016 = $100, with a $1,609,000 maxiumum
The IRS is also taking a harder stance on intentional disregard for accuracy. If the IRS believes a company is “intentionally careless” with 1099s, the company will pay the greater of $530 or 10% of the aggregate amount of what they were required to report. And there is no maximum.
How to Prepare for New IRS Filing Deadlines
If your company uses an outsource payroll service for W2 filings, the outsource service may be responsible for the W2 filing deadline but you will still have to file your own 1099s. In this case, it is critical that you be prepared for this new deadline.
Here are 4 ways that you can start your preparing for January 31st, 2017:
- Ensure that employee and vendor records are up-to-date
- Verify accuracy of Social Security Numbers and Tax Identification Numbers
- If you process payroll in-house, schedule your year-end updates in your payroll system to be completed prior to first payroll checks printed in January
- Consider a solution to simplify the reporting requirements for your company
Automate Your Payroll Tax Filing with Rand Group
Don’t let your company be caught By surprise with penalties. Payroll tax filing can be a fairly tedious and manual process when it comes to filing for employees and vendors. Especially now, when being anything less than 100% accuracy will result in a penalty. At Rand Group, our team of highly skilled technical experts, including former practicing certified public accountants, can help you automate the entire process and free up your staff. From updates and printing to reporting and electronic tax filing to the IRS, we can help streamline your processes to simplify and avoid any issues in the years to come.
Don’t leave your updates to the last minute – it could cost you thousands. Schedule a process evaluation today.
– Software Delivered as Promised. No Surprises.