Information Return, Payee Statement Penalties to Increase in 2016: Employment Law Manual Updated

Author: Rena Pirsos, XpertHR Legal Editor

Employers are subject to penalties under Internal Revenue Code (IRC) §§ 6721 and 6722 for failing to properly file information returns (e.g., federal Forms W-2, W-3 and 1099s) and provide required copies of those returns to employees and other payees. These penalties will increase substantially in 2016 under revenue offset provisions included in the Trade Preferences Extension Act of 2015, which was signed into law by President Obama on June 29.

The Depositing and Reporting Withheld Taxes section of the Employment Law Manual has been updated to reflect these changes.