The IRS recently held the second in an anticipated series of public meetings on a real-time tax system. The January 25 meeting in Washington, D.C. brought together IRS officials, software providers, payroll processors, and state officials.
"A real-time tax system would be a change in process across all aspects of the tax ecosystem changing many behaviors and processes that stakeholders are accustomed to," Dave Olsen, director of product management for CCH Small Firm Services, a business unit of Wolters Kluwer Tax and Accounting, told the IRS. Olsen also cautioned that late legislation would complicate the process.
Information returns. The processing of Forms W-2, Wage and Tax Statement, and various Forms 1099 could move to a real-time system, industry representatives said. However, a real-time system would require changes to current procedures. "Moving the deadline for providing Forms W-2 to employees earlier than the current deadline of January 31, could allow an earlier deadline for filing Form W-2 information with the Social Security Administration (SSA) and/or the IRS," Lori Brown, representing the American Payroll Association, said.
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