W-2 and 1099 Filing Requirement Change

As many are preparing to file information returns (W-2s, 1099s, etc) for 2023, we want to make sure you are aware of new IRS filing requirements. Beginning with tax year 2023, if you are required to file 10 or more information returns, they must be filed electronically. In the past, the threshold was 250 returns, and the IRS allowed each type of return to be counted separately. New regulations have reduced the number drastically and also now require filers to aggregate almost all information returns, including W-2s and all 1099s. So, for example, if an employer has 5 employees that receive W-2s, and 5 contractors who receive 1099-NECs, he is required to file all of those electronically.

The IRS has set up a free e-filing system called the IRIS Taxpayer Portal. To get started, taxpayers must apply for an IRIS Taxpayer Portal Transmittal Control Code. Unfortunately, the IRS website states that it may take some time to receive a control code after the application is filed. If you don’t already have a system in place, please call us for additional guidance.