IRS to require e-filing for most employers

    Authored by Bukaty Companies on March 1, 2023

    Starting in January 2024, a new IRS final rule will require information returns of 10 or more be filed electronically, eliminating the option for most smaller organizations to submit returns by mail. For decades, and through the end of the 2023 calendar year, the threshold requiring an entity to e-file has been 250 returns.

    The new rule requires filers to aggregate across return types. For example, an entity that files six IRS forms annually for two return types submits a total of 12 forms. The aggregating formula in the final rules would require this entity to file electronically starting in 2024.

    The final regulations include a provision to waive the electronic-filing requirement in cases of undue economic hardship. However, waivers for Form 5500 and 5500-SF will not be considered.

    Some of the returns affected by the new electric filing requirement are

    • 1094/1095 B and C series returns required under the Affordable Care Act (ACA),
    • Forms 1099,
    • employment tax returns, and
    • excise tax returns.

    Bukaty clients who have filed paper ACA forms previously should discuss with their benefits consultant how our in-house ACA team can provide e-filing support in 2024.

    For additional information, contact your Bukaty benefits consultant at 913.345.0440..

    While May 11 is significant, it’s the 60 days following the end of the national emergency, referred to as the “outbreak period,” that are tied to the expiration of benefit-related provisions defined by the Department of Labor (DOL) and the Internal Revenue Service (IRS) in a 2020 notice. Based on the 60-day timeline, the above benefit-related changes will take effect July 10, 2023.

    Note: Recent proposals in the House of Representatives would immediately end the COVID-19 national emergency rather than wait until May 11. The White House responded that advance notice, rather than a sudden withdrawal, is needed to avoid chaos within the nation’s health care system.

    For additional information, contact your Bukaty benefits consultant at 913.345.0440.