IRS Releases 2018 General Instructions for Certain Information Returns

February 26, 2018 Adam Rivera

The IRS has released the 2018 General Instructions for Certain Information Returns. These instructions provide filers with information they need to help file a variety of 1099 and 5498 forms. There are a number of changes from the previous revision:

  • Backup withholding rate has changes to 24% from 28%
  • For Form W-2, only one extension is allowed, and no automatic extension is available
  • Information for Form 1099-H has been added to the General Instructions
  • Copies 1, B, 2, C, and D, as applicable, to be furnished to recipients and kept in filer’s records, have been made online fillable for many forms referenced in these instructions
  • Maximum penalty amounts and penalties per individual return for those who file information returns after August 1 or not at all have increased slightly
    • From $260 per return to $270; Maximum penalty of $3,282,500
      • $1,094,000 for small businesses
    • Penalties for intentional disregard of filing requirements has increased to $540 per information return with no maximum penalty
    • New Notes:
      • Expired ITINs may continue to be used for information return purposes regardless of whether they have expired for individual income tax return filing purposes
      • The third parties who file and furnish information returns with an expired payee ITIN will not be subject to information return penalties under sections 6721 or 6722 solely because the ITIN is expired.
      • Backup withholding does not apply to “reportable payments that are withholdable payments made to a recalcitrant account holder that is a U.S. non-exempt recipient from which you have withheld under chapter 4”
    • Definition of Qualified Intermediary (QI) has been expanded

 To view the 2018 General Instructions, please click here.

About the Author

Adam Rivera is a member of the Regulatory Analysis Team's Direct Tax division at Sovos. His main areas of focus are Federal and State Tax Withholding and Affordable Care Act (ACA) Reporting. Prior to Sovos, Adam worked as a legislative aide in the Florida House of Representatives. He also has experience in securities law, focusing on securities litigation and researching emerging crowdfunding methods of raising capital. Adam is a member of both the Massachusetts and Florida Bars. He earned his B.A. from the University of Florida and his J.D. from the University of Miami.

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