IRS Proposes Rule on Electronic Filing Requirements for Certain Tax

On July 23, 2021, the IRS issued a notice of proposed rulemaking, amending the rules for electronically filing certain partnership, corporate income tax, unrelated business income tax, withholding tax, and excise tax returns. The proposed rule requires entities that will file more than 100 forms to file electronically, lowering the threshold from 250 returns to 100 returns. Additionally, the proposed rule clarifies that an entity would aggregate all the required forms when determining if they meet the 100-return threshold. The 100-return threshold will also decrease to 10 returns for any form filed in calendar year 2022.

The employee benefit plan-related information returns that would be subject to this proposed rule include the following:

• Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
• Form 5498-QA, ABLE Account Contribution Information
• Form 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information
• Form 8955-SSA, Annual Registration Statement Identifying Separated Participants With Deferred Vested Benefits
• Form 5500, Annual Return/Report of Employee Benefit Plan
• Form 5500-SF, Short Form Annual Return/Report of Small Employee Benefit Plan
• Form 5500-EZ, Annual Return of A One-Participant (Owners/Partners and Their Spouses) Retirement Plan or A Foreign Plan
• Form 5330, Return of Excise Taxes Related to Employee Benefit Plans

As with previous guidance, entities that are unable to file electronically may request a waiver from the IRS. Employer plan sponsors who complete any of the forms listed above should consult with their counsel or service providers to ascertain their obligation to file with the IRS electronically.

Electronic-Filing Requirements for Specified Returns and Other Documents »