Keep in Mind the Earlier Deadline!January 31, 2018. Keep that date at the front of your mind if you are an employer, employee or contractor. Because that is the date your W-2s and 1099s need to be filed. As a note, the W-2 is for employees, while the 1099 is for contracted workers. At Stevens Pierce & Associates, CPA’S in Twin Falls, ID, we work with both individuals and small business owners, and we provide experienced assistance with filing W-2s (which go to the SSA) and 1099s (which are submitted to the IRS). It is very important that the information in these reports be accurate and timely in order to avoid penalties, so it is helpful to hire an accountant to help you ensure everything is done correctly!
When did the deadline change?This earlier deadline was enacted by the 2015 PATH Act, which was put into place on December 18, 2015. Before this act, the deadline for submitting the W-2 and 1099 in paper form was the end of February, and if you were submitting electronically, the date was March 31. However, this act made the deadline for submitting, both in paper and electronic form, January 31. The deadline for employers providing their employees and workers with their W-2 or 1099 is still the same: January 31. However, now that the filing deadline is also January 31, it is helpful to provide employees and contractors with these reports as early as possible.
What is the purpose of setting the deadline earlier?An earlier deadline is helpful for IRS. This is because, when the reports are submitted earlier, they have more time to catch errors, detect fraud, and to potentially prevent fraud as well. Plus, if you are expecting a tax refund, you will receive that refund earlier. Who wouldn’t like to have some extra cash earlier rather than later?
Will you get in trouble if you don’t meet the deadline?There are penalties if you don’t file your W-2 and 1099 on time. This penalty increases the longer you wait to submit. For large businesses, if you submit within 30 days of January 31, your penalty is $50 per return/statement you submit, with a maximum of $536,000. This penalty increases to $100 per return/statement, with a maximum of $1,609,000, if you submit between 31 days after the deadline and August 1. If you file after August 1 (or you don’t file at all), you are subject to a fine of $260 per return/statement, with a maximum of $3,218,500. However, for small businesses (businesses with gross receipts under $5,000,000 for the past three years), the penalty per statement remains the same, but the maximum penalties are decreased. For statements filed within 30 days of January 31, the maximum penalty is $187,500. If the statement is filed between 31 days and August 1, the maximum penalty is $536,000, and the maximum penalty is $1,072,500 if filed after August 1.
No one wants to face fines and penalties that are completely preventable! So make sure you are getting your W-2s and 1099s submitted on time. Contact our accountants today at 208-734-8662 if you have any questions, and for all of your tax planning and preparation needs. With us, you will find that you no longer have to dread tax season!