What is the deadline for businesses to send W2s and 1099s to employees, contractors, and the federal government?
You must prepare, distribute and file W2 forms by the January 31, 2025 deadline if your business employs workers classified as employees who earned wages during the year for which income taxes, Social Security tax, or Medicare tax were withheld, or for whom income taxes would have been withheld had the employee not claimed a withholding exemption or had they claimed no more than one withholding allowance.
For workers classified as independent contractors who earned at least $600 in 2024 for services provided, business owners must instead file the appropriate 1099 form with the IRS and distribute the form to the worker. For the 2024 tax year, form 1099-NEC (Nonemployee Compensation) will be used in most cases instead of the 1099-MISC form.
What is the deadline for employers to send federal unemployment tax reports to the IRS?
Most small businesses with non-household or agricultural employees are required to pay federal and state unemployment taxes. If your business paid wages of $1,500 or more to employees in any calendar quarter or had one or more employees for some part of a day in 20 or more different weeks during the year, you must file IRS Form 940, Employer's Federal Unemployment Tax (FUTA) Return.
The filing deadline for 2024 federal unemployment tax reports is also January 31, 2025. However, employers who have a federal unemployment tax liability of $500 or more for the 2024 calendar year must make at least one quarterly deposit during the year. If you paid all FUTA tax when due during the calendar year, you actually have until February 10, 2025 to file your return.
Can I file unemployment tax reports, W2s, and 1099s online?
Yes, you can. Employers are encouraged to file their W2s, 1099s, and unemployment tax reports electronically.
Small businesses may file W2s electronically using the Social Security Administration's BSO website, which provides different methods for creating and uploading completed forms, depending on how many employees' forms you need to prepare. If you need to file 1099-NEC or 1099-MISC forms, you can do so using the IRS Filing Information Returns Electronically (FIRE) system.
Similarly, employers required to file federal unemployment tax returns may e-file form 940 and submit payments online using the Electronic Federal Tax Payment System (EFTPS.)
What are the penalties for filing late, and are there exceptions to the deadline?
The IRS uses wage and income information submitted by employers using W-2s and 1099s to verify the accuracy of income information reported by employees and independent contractors on their tax returns. Because workers also depend on these reports, there are no automatic filing extensions available for employers for W-2 or 1099 forms, although the IRS may grant extensions to employers in specific circumstances.
Financial penalties for small businesses filing after the deadline can add up quickly. For the 2024 tax year, small businesses face penalties of $60 per return filed within 30 days of the deadline. That rate rises to $130 per return filed between 31 days after the deadline and August 1, and to $330 per return filed after August 1 or not at all, up to a maximum of $1,329,000 for small businesses.
Filing your federal unemployment tax report late could result in your business facing tax penalties and interest on the amount of unpaid taxes for each month tax payments are overdue. The amount of penalties varies depending on how late you file and pay your federal unemployment tax liability.
How do I plan now to meet all my filing deadlines?
Putting off your tax reporting and filing obligations until the last minute could result in errors or unexpected delays that may end up costing your business in the long run. Entrepreneurs and small business owners can avoid this type of problem by being proactive now. This includes verifying employees’ names, addresses, Social Security numbers, or Taxpayer Identification numbers, and confirming the company’s information on file with the IRS and the Social Security Administration is accurate and complete. Making a calendar of your due dates and deadlines can help ensure that you meet your obligations.
Tax matters can be complex. Getting professional guidance can help your business meet its obligations to its workers and the federal government. If you have questions, reach out to a Tax Pro for help understanding the deadlines and rules that apply to your business. They can help you complete and file your W-2s, 1099s, and federal unemployment tax reports accurately and completely, as required.
This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.
