Are You Ready? Why Businesses Need to Prepare for 2011’s Increased Tax Information Reporting Penalties
by Kip Cawley, Esq.
Businesses that are required to file federal tax information returns and payee statements (i.e., Forms W-2, 1099 and 1098) will be subject to significantly increased penalties for all information returns filed after January 1, 2011. As the 2010 information reporting season nears, and as the IRS becomes increasingly strict with compliance issues as a means to generate additional revenue for the federal government, businesses should be aware of what lies ahead and what must be done to ensure compliance and be in a position to successfully challenge penalty assessments.