A rule change, effective Jan. 1, 2024, for the 2023 tax year, requires businesses that file 10 or more information returns with the Internal Revenue Service (IRS) to do so electronically.

Before the new rule, only businesses filing 250 or more information returns were required to file electronically. The 250-return threshold was applied separately to each type of information return.

The new e-filing requirements will be imposed on: partnership returns, corporate income tax returns, unrelated business income tax returns, withholding tax returns, certain information returns, registration statements, disclosure statements, notifications, actuarial reports, and certain excise tax returns.

Here are just some of the forms involved:

  • Forms 1099 issued to report independent contractor income, interest and dividend income, retirement plan distributions, prizes and other payments,
  • Form W-2 issued to report employee wages,
  • Form 1098 issued to report mortgage interest paid for the year, and
  • Form 8300 issued to report cash payments over $10,000 received in a trade or business.

Additional forms included in the rule can be found here.

The IRS may impose penalties on companies that are required to e-file information returns but instead file them on paper. Filers who would suffer an undue hardship if they had to file electronically can request a waiver from the e-filing requirement by filing Form 8508 found here on the IRS’ website.

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