new IRS reg for filing 1099 online
I’m working on a story about this regulation proposed today:
I’m a reporter for MLex US Tax Watch, a Lexis Nexis publication that covers the IRS.
I’m on a tight deadline. Can you help with background, perspective and/or a comment on this?
Thanks very much.
The good news is that this only would impact businesses filing 250 returns or more, so most small businesses, with fewer than 249 employees would be exempt from compliance. That’s a good thing as small businesses don’t often have onsite payroll staff to manage changing IRS regulations.
Any business that objects, needs to be proactive now, and respond by the due date with their comments!
What I think will happen is larger companies will benefit by filing on magnetic media, once they get the process implemented.
Smaller businesses working with payroll companies like Gusto, ADP and its alternatives, may also not be impacted much. The payroll software company will do the compliance work as part of their standard IRS and tax service, so it may feel seamless to those firms.
The companies that will struggle most, are those with hundreds of employees, who are trying to manage their payroll and taxes internally. They may choose to outsource payroll instead, as regulations like these occur often, not just at the federal level but the state level.
Laura Handrick, Workplace Analyst, SPHR, http://www.fitsmallbusiness.com