Until this year, employers had two dates to keep in mind when preparing 1099’s and W-2s. Beginning with 2016 forms, employers will now have one filing deadline for all Federal information returns – January 31, 2017. This applies for both employee and agency copies, or whether filing paper or electronic returns. The state of Georgia has also adopted the new January 31 filing deadline.
You also need to know that the penalties for missing the deadlines have increased significantly. Erroneous or unfiled information may mean thousands of dollars in penalties.
The Internal Revenue Service (IRS) says they changed the deadline to cut down on fraud. With filings due at the end of January (rather than February for paper filings and March for electronic filings), it gives the IRS the month of February to match up what you file as an employer with what the employee files. A 2014 Government Accountability Office (GAO) report states that the IRS paid $5.2 billion in fraudulent identity theft refunds in 2013. The full extent of fraudulent refunds is unknown because of the challenges inherent in detecting identity theft-related refund fraud.
About refunds, it is important to note that the IRS recently announced that refunds would be delayed until February 15 for those who claim the Earned Income Tax Credit or the Additional Child Tax Credit. This is a congressionally-approved change also aimed at battling tax refund fraud and identity theft. Read more about the delay and the reasons for it here.