As a courtesy, we are reminding our bookkeeping clients that deadlines for W-2’s and 1099-MISC have changed for reporting to IRS which will affect all our bookkeeping clients. In an attempt to help you get the necessary work accomplished by December 31, 2016, we ask that you pull your subcontractors, contract labor and attorney payments for 2016 now and make sure that you have a good and current W-9’s on each of them and that the W-9 has been completely filled out so you are ready for January. If you/we print and file your 1099-MISC and you have $$ in Box 7 (Non-Employee Compensation) , they must be mailed to the subcontractor AND Internal Revenue Service on January 31, 2017. If you have $$ in Box 8 or Box 14, you can file by those 1099-MISC forms separately by February 28, 2017 if you file on paper, or by March 31, 2017 if you file your forms electronically. Late fees for not filing on time with penalties will apply after January 31, 2017. Failure to file correct information (name, address, social security or EIN number & correct amount paid to payee) Returns by the Due Date:
- $50 – per 1099-MISC if you correctly file within 30 days of due date; maximum penalty $532,000/year ($180,000 for small businesses)
- $100 – per 1099-MISC if you correctly file more than 30 days after due date but by August 1; max penalty is $1,596,500/year ($532,000 for small businesses)
- $260 – per 1099-MISC if you file after August 1 or you do not file require information 1099 returns; maximum penalty is $3,193,000/year ($1,064,000 for small businesses)
Intentional disregard of filing requirements:
- Failure to file a correct information return is due to intentional disregard of the filing or correct information requirements, the penalty is at least $530/1099 with NO maximum penalty!
Failure to furnish correct payee statements:
- If you fail to provide correct payee information on the 1099 (name, address, social security numbers or EIN numbers and correct amounts paid to payee) and you cannot show reasonable cause, you may be subject to a penalty. The penalty applies if you fail to provide the statement (1099) by the due date January 31 for most returns.
If you/we print and file your W-2/W-3’s, they must be mailed to the employee AND the Social Security Administration on January 31, 2017. Again, late fees for not filling on time with penalties will apply after January 31, 2017.