If you’re a business owner, don’t forget about the date January 31, 2017, the new due date for filing forms W-2.
Under a new law, the Protecting Americans from Tax Hikes (PATH) Act, enacted last December, the new filing deadline for employers to submit forms W-2 to the Social Security Administration, is January 31. The new January 31 filing deadline also applies to certain forms 1099-MISC reporting non-employee compensation such as payments to independent contractors.
The January 31 deadline for employers to furnish copies of tax forms to employees is still the same.
W-2 Changes
The new law also changes the rules for extending time to file forms W-2. Now, you can only request one 30-day extension to file form W-2, and it is not automatic. If you, as an employer, need an extension, you must file form 8809, Application for Extension of Time to File Information Returns (downloads as a pdf). The form should be completed as soon as you know an extension is necessary, but no later than January 31.
Stay up-to-date with the IRS date change.
Before, employers had until the end of February (paper filing), or the end of March (electronic filing), to submit these forms. However, the gap between that due date and the beginning of the filing season made it difficult for the IRS to match up forms W-2 with tax returns requesting refunds, which increased fraud. The new deadline, long on the the IRS wish list, makes it easier to verify the legitimacy of tax returns and give refunds.
PATH Patience
Many other taxpayers might hear a different story. The PATH Act also requires the IRS to delay refunds involving two key refundable tax credits, the Earned Income Tax Credit (EITC) and the Additional Child Tax Credit (ACTC), until at least February 15. This new law requires the IRS to hold the entire refund for any taxpayer claiming either of these credits until February 15, and not just the portion related to the EITC or ACTC.
The IRS says that taxpayers should still file their returns as they always do. However, practice some patience. With these changes, some delays are sure to come. Normally, the IRS issues more than nine out ten refunds in less than 21 days. Expect delays as returns are held for further review.
Stay informed about tax changes by calling Williams & Kunkel CPA today in Flower Mound at 972-446-1040 to have a chat.
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Source: Forbes