Final rules accelerate W-2 filing, modify extension requests

The IRS has finalized rules for filing Forms W-2 and Forms 1099-MISC with box 7 filled in. The final rules accelerate the time for filing these forms and modify extension requests.
Under the new rules, there is no automatic extension of time to file:

  • Forms W-2 (except Form W-2G), or
  • Forms 1099-MISC with information in box 7.

In NPRM REG-132075-14, the IRS proposed to include a number of other forms in this no automatic extension rule. In the end it left out the other forms because there is less risk of them being used for identity or refund fraud. Instead, filers who need an extension will use Form 8809 to request a nonautomatic 30-day extension.
The IRS has five specific situations in which it will grant an extension of time to file. The updated Form 8809 will contain checkboxes for each reason.

Rules modify extension requests

The IRS will grant a nonautomatic 30-day extension only when:

  • the business is in a federally declared disaster area and that disaster (a) left the business unable to resume operations, or (b) made necessary records unavailable.
  • fire, casualty or natural disaster affected the operation of the business;
  • the death, serious illness or unavoidable absence of the individual responsible for filing the returns affected the business’s operation;
  • the information return is being filed for the first year of business, or
  • the filer did not timely receive data on a third-party payee statement.

Additionally, the IRS will grant an extension if the filer receives the third-party payee statement by the statutory furnishing deadline, but did not receive the statement in time to prepare an accurate information return.

If at least one of the criteria for granting an extension applies, the IRS will grant a 30-day extension. Filers who do not get a requested extension may ask for an abatement of a late filing penalty.

The IRS made these changes so it can use the information on Forms W-2 and 1099 in its identity theft and refund fraud detection process. Filers of other information returns may still get an automatic extension. The regulation contains a list of those returns.

The rules affect filers requesting an extension of time to file certain information returns. The regulations are effective on August 3, 2018. (T.D. 9838, August 2, 2018.)

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