Jan. 31, 2017, is the new deadline for employers to supply W-2 forms to workers and file copies of Form W-2 with the Social Security Administration (SSA) for the 2016 tax year. This is one month earlier for paper filers and two months earlier for electronic filers. It also applies to businesses filing Forms 1099-MISC that report payments exceeding $600 for the year to independent contractors or other service providers.
The change in filing deadline for the 2016 reporting period is the result of the Protecting Americans from Tax Hikes (PATH) Act, as well as the IRS’s efforts to authenticate the validity of taxpayers’ individual returns and reduce the filing of fraudulent tax returns.
The new law also changes the rules for businesses to extend the time to file Form W-2. Employers seeking a 30-day extension must make a written request via Form 8809, Application for Extension of Time to File Information Returns, before Jan. 31. Previously, employers had until the end of February (if filing on paper) or the end of March (if filing electronically) to submit these forms and request an extension.
To prepare for the earlier filing deadline in 2017, businesses should be reviewing their accounting records to identify vendors that are subject to the reporting requirements. Each qualifying vendor that the business issues payments to should complete a Form W-9 to certify his or her tax status, name, address and tax ID number, which, in turn, will help determine if they should receive a Form 1099-MISC from the business.
As a result of the accelerated filing deadline, the IRS warns that taxpayers claiming either the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) should expect a delay in receiving any refunds to which they may be entitled. Under the law, the IRS must hold a taxpayer’s entire refund, and not just the portion related to the EITC or ACTC, until Feb. 15. Taxpayers expecting a tax refund to make a major purchase or meet another financial obligation must plan appropriately, keeping the delayed refund date in mind.
