New W-2 and 1099 E-Filing Requirements for Employers in 2023

by Rachelle Kelly

ARTICLE | December 19, 2023

Starting January 1, 2024, the IRS has changed the rules for filing tax returns. If a business files 10 or more forms (like W-2s or 1099s) in a year, they must now file these forms electronically instead of on paper. Before, the rule applied to businesses filing 250 or more forms.

The 10-return threshold is determined by adding up the total number of various types of returns, not by counting the number of returns for each specific type. For instance, if an employer has eight W-2s, one 1099-NEC, and one 1099-DIV, they must file electronically because the total number of information returns (10 in total) needs to be considered to assess if the threshold has been reached.

If a business doesn’t follow these new rules, the IRS can charge up to $310 for each form not filed electronically.

Who Does This Affect?

Businesses that file 10 or more employment tax forms, like W-2s or 1099s, in a single year must now file these forms electronically. Paper filing is no longer allowed.

Next Steps

To assist filers in this new process, the IRS has created an online portal for businesses filing Form 1099 series. The Information Returns Intake System, or IRIS, is free and requires no special software, although it does require you to register in advance in order to use it. For W2 submissions, the Social Security Administration allows e filing of up to 50 forms via Business Services Online (BSO). Employers can sign up or learn more here. You can learn more about the IRS ruling here and the IRIS portal here.

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Rachelle Kelly, MBA, Certified Quickbooks ProAdvisor

Rachelle Kelly, MBA, Certified Quickbooks ProAdvisor

Client Accounting Services Manager

Rachelle joined Larson Gross in 2021. She graduated from Southern New Hampshire University with an MBA in 2018, and also has a bachelor’s degree in Food and Nutrition Science from Seattle Pacific University.

Prior to joining Larson Gross, Rachelle served as the Financial Planning and Analysis Manager and Accountant at an aerospace manufacturing business. Her passion is to help business owners successfully run their business with accurate and timely financial data and has experience serving a wide variety of industries, including manufacturing and construction.