IRS lowers e-filing threshold to 10 information returns of any type

Eric Updated by Eric

It's official—the IRS now requires employers to electronically file the following forms if they have an aggregate of 10 or more of:

  • W-2
  • 1099 series
  • 1098 series
  • W-2G
  • 1042-S
  • 1094
  • 1095 series
  • 3921
  • 3922
  • 8027
This requirement applies to filings for Tax Year 2023 and beyond (i.e. forms that are filed starting in 2024).
Calculating the number of returns —Specifically, the final regulations require filers to aggregate almost all information return types covered by the regulation to determine whether a filer meets the 10-return threshold and is required to e-file their information returns. Earlier regulations applied the 250-return threshold separately to each type of information return covered by the regulations.

Affected employers should take steps now:

  1. View Preparing to e-File 1099's and W-2's
  2. Re-evaluate your need for paper forms
  3. Purchase or renew the W-2/1099 e-File Add-on and review the documentation.
Almost all federal e-filing now requires the user to login under the “ID.me” system.  If you are not already enrolled in ID.me, see this link for more information: IRS migrates e-Services login to ID.me
The IRS recommends obtaining a FIRE Transmitter Control Code (TCC) by November 1st as the process may take 45 days.
BSO registration takes longer than in previous years.  After Registering on BSO and requesting “SSA Services Suite for Employers” (under “Request New Services”), it can take up to 2 weeks for BSO to mail activation code to the employer.  Also for certain registrants, adding “additional security” is required.
Corrected returns must be filed in the same manner as the original: e-filed or paper filed.

About the new regulation

The Taxpayer First Act gave the IRS the authority to mandate that filers filing 10 or more of any type of information returns in aggregate do so electronically beginning with the 2022 tax year, but didn't exercise that authority until February 2023.

Furthermore, corrected returns must be filed in the same manner as the original: e-filed or paper filed.

The IRS recommends obtaining a FIRE TCC by November 1st as the process may take 45 days.

New for tax year 2023: CFS will support a CSV file upload to the new IRS Information Returns Intake System (IRIS). This system requires a separate TCC from the FIRE TCC.
See this article for more information about Payroll System’s new support for the IRIS system: IRS migrates e-Services login to ID
Note: that IRIS is completely independent from IRS’ FIRE system. 

For further reading, see Electronic-Filing Requirements for Specified Returns and Other Documents, particularly:

The IRS has the authority to penalize any employer who does not file electronically if they meet the threshold.

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