Information on Penalties for Non-Compliance of New Form 1099 Filing Rules

Small Businesses with Gross Receipts $5 Million or Less

(Average annual gross receipts for the most recent 3 taxable years) IRC 6721 & IRC 6722
Time returns filed/furnished
Due 01-01-18 thru 12-31-2018
(inflation adjusted)
Not more than 30 days late
(by March 30 if the due date is February 28)
$50 per return/
$187,500 maximum
31 days late –August 1 $100 per return/
$536,000 maximum
After August 1 or Not At All $260 per return/
$1,072,500 maximum
Intentional Disregard $530 per return/
No limitation
Large Businesses with Gross Receipts of More Than $5 Million and Government Entities

(Average annual gross receipts for the most recent 3 taxable years) IRC 6721 & IRC 6722
Time returns filed/furnished
Due 01-01-18 thru 12-31-2018
(inflation adjusted)
Not more than 30 days late
(by March 30 if the due date is February 28)
$50 per return/
$536,000 maximum
31 days late – August 1 $100 per return/
$1,609,000 maximum
After August 1 or Not At All $260 per return/
$3,218,500 maximum
Intentional Disregard $530 per return/
No limitation
Penalties for not filing correct information returns (Code Section 6721) may apply if you:
  • Don’t file a correct information return by the due date and a reasonable cause is not shown;
  • File on paper when you were required to file electronically;
  • Don’t report a Taxpayer Identification Number (TIN);
  • Report an incorrect TIN; or
  • Don’t file paper forms that are machine readable.
 
Penalties for not providing correct payee statements (Code Section 6722) may apply if:
  • You don’t provide a correct payee statement by the applicable date and a reasonable cause isn’t shown;
  • All required information isn’t shown on the statement; or
  • Incorrect information is included on the statement.
** The above information is in reference to data provided by  www.irs.gov.
As you can see, the IRS has gotten very serious on its desire to get these forms filed, and filed on time. Each “return” mentioned above means each 1099 form, so the amount can add up quickly.
Once again, if you need our assistance in filing your 1099’s, or if you merely want to verify that you do or don’t have to file them, you must contact us.  As an obvious example, if you have an operating business or rental property and the business or rental property pays Louis T. Roth & Co., PLLC a fee of at least $600, a Form 1099 must be filed.
Please let us know if we can be of further assistance.