Tax Update — New 1099 Penalties

Tax Update — New 1099 Penalties
Posted: Aug 29, 2017
Categories: Public Policy
Comments: 0

by Mitch Reitman - Reitman Consulting Group, Inc.

Most of you have heard me discuss the perils of treating employees as “contractors” and issuing them IRS forms 1099. Not only is it a bad idea to treat an employee as a contractor, the IRS has instituted new requirements, and penalties, for misfiled and late filed 1099’s. Filers can receive up to a $530 per record penalty, (a $3+ million maximum penalty for even a mid-sized penalty), if delivering 1099 or W-2 statements and after the IRS deadlines. To make things worse, even if you can scrape together the penalty money, penalties aren’t deductible against your Federal Income Tax liability.

Intentional disregard for furnishing or filing information returns is a $530/return penalty.

For more, download the July/August edition of ESA’s print magazine, Security Nation. Security Nation is a glossy magazine publication. This exclusive ESA Member Benefit is mailed 6x per year, including profiles of ESA Members, industry news, association updates, best business practices and more. For more information on becoming an ESA Member, contact Membership@ESAweb.org.

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