Advisory council has long list of payroll-focused suggestions
Between state and federal regulations, you already have enough on your plate.
But if you aren’t vigilant, you’re likely to miss a slew of new rules.
That’s thanks to the Internal Revenue Service Advisory Council (IRSAC), which recently released its latest list of recommendations for the IRS – a list that the Service has a history of taking to heart.
Most importantly, 2016’s recommendations are full of Payroll-impacting policies.
Changes on the way?
IRSAC has taken a major interest in fraud prevention for tax returns.
To that end, it recommends:
Sending W-2 information directly to the IRS. Much of the data the IRS receives comes from the SSA – and it first needs to be modified before the Service can do anything with it.
IRSAC says employers should have to send their W-2 data directly to the IRS
Filing more data with the IRS each quarter. You already send Form 941 each quarter.
Now the Council’s pushing for Payroll to include more info in these reports so the IRS can flag data inconsistencies well before year-end.
Continuing the W-2 verification code pilot program. The program has shown promising results: By adding more information on W-2s, accuracy rates have shot up.
Count on this happening, as the IRS has already reported it intends to beef up this practice in 2017.
Implementing more IRS ID-verification practices. Due to the treat of fraud attacks not that the IRS is using private collectors, IRSAC suggests the IRS launch an ID-verification process so that people can confidently respond to private industry reps working on the IRS’s behalf.
Using more truncated numbers. To protect more businesses, IRSAC is pushing to allow more truncated identification numbers on information returns, like your company’s EIN on W-2s.