N.C. waives Form NC-3 late filing penalties

On September 15, 2017, the Secretary of Revenue (Secretary) announced that the Department of Revenue (Department) would impose a failure to file penalty on NC-3 forms due to be filed on January 31, 2018, if the form was not timely filed (see Payroll Management Guide Report Letter Issue No. 2524, October 3, 2017). Because the Secretary has become aware that some taxpayers have had questions regarding the Department’s filing requirements for Form NC-3 and certain 1099 informational returns, the Secretary has elected to automatically waive the failure to file penalty on NC-3 forms due to be filed by January 31, 2018, but which are filed after that date. As such, the Department will not impose the failure to file penalty on NC-3 forms due to be filed on January 31, 2018 if the return is not timely filed. Taxpayers who submit Form NC-3 after January 31, 2018 should not include the $50 failure to file penalty on Line 21. If a taxpayer has previously paid the $50 failure to file penalty on Form NC-3, the Department will refund the penalty.

Clarification of filing requirements for Form NC-3 and certain 1099 informational returns.

In November 2017, the Department published a specifications document to assist employers with filing Form NC-3. The Department also published an additional document in December 2017 (revised January 2018) to assist certain entities with the submission of various forms including, but not limited to, NC-1099NRS, NC-1099PS, NC-1099ITIN, 1099-K, 1099-R, and 1099-MISC.
The Department continues to receive questions regarding the filing of NC-3, W-2, and 1099 forms. Specifically, the Department has provided the following guidance in response to taxpayer questions:

  • The Department requires Form 1099-MISC to be filed directly with the Secretary if the payer has not withheld North Carolina income tax from the recipient.
  • Forms NC-3 or NC-3X need not be sent as a cover page with 1099-MISC forms. Any required Forms 1099-MISC may be filed either by using the Department’s eNC3 application portal or by mailing paper copies to the Department.
  • Original Forms NC-3 and accompanying W-2s or 1099s may be submitted in paper form. The Secretary has granted an automatic waiver to businesses that cannot meet the electronic submission filing requirement for NC-3, W-2, and 1099 forms due to be filed on January 31, 2018. This is an automatic waiver – no action is required.

Taxpayers seeking further information may call the Taxpayer Assistance Division at 877-252-3052 (8:00 am until 5:00 pm EST, Monday through Friday), or write the Department at PO Box 1168, Raleigh, NC 2760. (North Carolina Department of Revenue, Important Notice, February 8, 2018.)

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