Information Return Electronic Filing Requirements Updated

The IRS has introduced new information return electronic filing requirements for the 2024 tax year, lowering the threshold for e-filing and expanding the rules for corrected filings. The changes affect businesses reporting payments, dividends, health care payments, and other reportable transactions across multiple federal return types.

Electronic Filing Rules Expand For 2024

The IRS now requires businesses to file information returns electronically when the combined total reaches 10 or more forms in a calendar year. This includes Forms W-2, 1099-NEC, 1099-INT, dividend reports, estate payments, and health care payments. The agency states that other filers submitting settlement reports or third-party network transactions are also covered under the new threshold.

Businesses must file information returns electronically even when submitting multiple return types. A filer submitting five Forms 1099-NEC and five Forms W-2 must file electronically because the combined total meets the 10-return requirement. The IRS advises filers to review their records early to determine whether they must file electronically by the due dates.

Correction Rules For E-Filed Returns

The IRS states that if an original return is e-filed, the corrected return must also be e-filed. Paper corrections will not be accepted when the original filing was submitted electronically. The rule applies to both the FIRE system and the IRIS platform, which allows filers to create forms, upload templates, submit files, and correct earlier submissions.

The IRIS portal provides a free option for small businesses to file information returns electronically. The system performs checks for missing information, valid taxpayer data, and reportable transactions. Filers receive a notice within 48 hours confirming whether the IRS accepted the submission, and the IRS login page displays a locked padlock icon indicating secure access.

E-File Requirements Affect Businesses Nationwide

Electronic filing has become the default method for most information returns, and filers who submit paper returns may receive a notice of noncompliance. The IRS emphasizes that the updated e-file requirements apply whether filers use commercial software, the IRIS system, or an attorney or accountant submitting forms on behalf of a business.

The updated process is intended to streamline reporting, reduce errors, and align with other federal systems, including the Social Security Administration. Electronic submissions provide faster confirmation notices and more precise instructions for correcting mistakes after the original return was e-filed.

File Information Returns Electronically Under New Threshold

Filers must electronically file forms reporting payments, dividends, medical payments, and transactions that make reportable transactions for federal purposes. The IRS publishes a complete list on its website along with examples of how to correct e-filed returns for a prior tax year. Penalties may apply for failing to file electronically when required.

The IRS encourages businesses to maintain accurate records, confirm the correct return type, and verify the validity of taxpayer information before submitting files electronically. Due dates remain unchanged, and filers should monitor system messages to ensure submissions are accepted without errors.

Returns Electronically Submitted May Reduce Processing Delays

Businesses that previously filed fewer information returns on paper may now fall under the 10-return threshold, as all forms filed during the calendar year are aggregated. The IRS advises companies to access the IRIS platform early, create accounts, test templates, and verify records before submitting returns electronically. This process helps reduce errors that could lead to penalties or rejected filings.

The agency notes that small businesses may benefit from the free IRIS filing option, which supports the electronic preparation, submission, and correction of returns. Filers are urged to check the page last reviewed or updated dates on IRS documents to confirm they are relying on current guidance for the tax year.

Sources

• IRS Newsroom
  
  
• IRS IRIS Portal
  
  
• General Instructions for Certain Information Returns

By William Mc Lee, Editor-in-Chief & Tax Expert—Get Tax Relief Now