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One, Big, Beautiful Bill

The One, Big, Beautiful Bill Act (OBBBA) has a significant effect on federal taxes, credits and deductions. It was signed into law on July 4, 2025, as Public Law 119-21. One, Big, Beautiful Bill provisions provides information and resources for taxpayers regarding P.L. 119-21.

Information Reporting Required in Connection with No Tax on Tips and Overtime

There will be no changes to the 2025 Form W-2, Form 1099-NEC, Form 1099-MISC, or Form 1099-K to account for the new reporting requirements for qualified tip and overtime compensation that were added by OBBBA. See Notice 2025-62 PDF. For 2025, some employers and other payers may choose to separately report the amount of qualified overtime compensation to employees using box 14 of Form W-2 or to employees or payees through an online portal or on a separate statement.

Information reporting threshold increased for certain payments

For payments made after Dec. 31, 2025, OBBBA increases minimum threshold for reporting on information returns (such as Forms 1099-MISC and Forms 1099-NEC) certain payments made by a person engaged in a trade or business. For wages paid in calendar year 2026, OBBBA also increased the wage reporting threshold where no federal income, Social Security, or Medicare taxes were withheld. The thresholds are $2,000 for payment made in 2026 and will be adjusted for inflation for subsequent years. For details on filing information returns, including threshold amounts and electronic filing requirements, see General Instructions for Certain Information Returns. Separate instructions are also available for specific forms. Direct deposit of employment tax refunds now available

Executive Order (EO) 14247, Modernizing Payments To and From America’s Bank Account, issued on March 25, 2025, promotes operational efficiency by mandating the transition to electronic payments for all federal disbursements. Accordingly, the IRS will now issue employment tax return refunds by direct deposit. Direct deposit is a fast, simple, safe, and secure way to have your refund deposited automatically to your checking or savings account. Instead of a direct deposit refund, you can still choose to have your overpayment applied to your next return by checking the appropriate box on your employment tax return. For more information, see the instructions for your employment tax return.

Business tax account

Business Tax Account allows authorized users of certain types of businesses or other entities to access and manage their business tax information and offers the ability to make tax payments, review tax records and read your latest notices. IRS business tax account is available to:

• sole proprietor,
• business partnerships that file Form 1065, U.S. Return of Partnership Income,
• entities that file Form 1120-S, U.S. Income Tax Return for an S Corporation,
• entities that file Form 1120, U.S. Corporation Income Tax Return, and
• single member LLCs that file either Form 1120-S or Form 1065.

Be sure to check the business tax account site often, as the IRS will continue adding new features designed to help you quickly and easily manage your federal tax information.

Employment tax return transcripts are now available electronically

You can now access Form 940, Form 941, Form 943, Form 944, and Form 945 return transcripts for tax years 2023 and later using your IRS business tax account. For more information, go to business tax transcript.

Taxpayer Advocate Service

The Taxpayer Advocate Service (TAS) can help you help your clients. We have a variety of information for tax professionals, including tax law updates and guidance, TAS programs, and ways to let TAS know about systemic problems you’ve seen in your practice.

This includes Forms W-2, e-filed with the Social Security Administration.

Form W-2/SSN data theft: Information for businesses and payroll service providers

This email scam uses a corporate officer’s name to request employee Forms W-2 from company payroll or human resources departments. The email is sent to an employee in the payroll or human resources departments, requesting a list of all employees and their Forms W-2. See the full article for steps to take in contacting the IRS if businesses and payroll service professionals received the email and/or lost data to this scam.

Worker classification

Worker classification (independent contractors vs. employees)

Are you or your help independent contractors or employees? Before you know how to handle payments you make for services, you must first know the business relationship that exists between you and the person performing the services. For more information refer to Publication 5520, How Businesses Determine if a Worker is an Employee or Independent Contractor PDF.

Voluntary Classification Settlement Program

The Voluntary Classification Settlement Program (VCSP) is a voluntary program that provides an opportunity for taxpayers to reclassify their workers as employees for employment tax purposes for future tax periods with partial relief from federal employment taxes.

Employees and employment taxes

Employment taxes for businesses

This is the starting point on irs.gov for employment tax information. These links provide good, basic information on employment taxes and worker classification (independent contractors vs. employees).

Businesses with employees

This section briefly discusses a variety of topics that employers and/or businesses who have employees should know.

Correcting employment taxes

Information on correcting errors on previously filed employment tax returns.

Outsourcing payroll and third-party payers

Many employers outsource some of their payroll and related tax duties to third-party payroll service providers. They can help assure filing deadlines and deposit requirements are met and greatly streamline business operations.

Voluntary Certified Professional Employer Organizations (CPEO) Program

The IRS to establish a voluntary certification program for professional employer organizations (PEOs). PEOs handle various payroll administration and tax reporting responsibilities for their business clients and are typically paid a fee based on payroll costs.

Staying up to date

Topics in the news page is where you will find items of current interest – new programs, recent guidance or timely reminders. The IRS will also provide critical updates through social media.

Subscribe to a variety of electronic newsletters from this page, including:

• e-News for payroll professionals - information specifically affecting federal payroll tax returns
• e-News for tax professionals - news for tax professionals, links to resources on IRS.gov and local news and events by state
• e-News for small businesses - information about IRS small business outreach products and programs

The IRS hosts monthly payroll industry calls/meetings to share outreach initiatives, provide information, form/return updates, and educational support for payroll professionals and their clients. Meetings are usually held on the first Thursday of every month at 1 p.m. Eastern time. Please note, in the event of unforeseen events, such as technical outages, Federal holidays, etc., the meeting may be cancelled or rescheduled. Email npl.payroll@irs.gov to join the invitation list and submit questions.

Electronic options

E-file employment tax forms

Generally, employers must report wages, tips and other compensation paid to an employee by filing the required form(s) to the IRS. You must also report taxes you deposit by filing Form 941, Form 943, Form 944, Form 945, and Form 940 on paper or through e-file. A fee may be charged to file electronically.

You can also e-file corrected employment tax returns Form 941-X, Form 943-X, and Form 945-X. The Form 940 e-file program allows you to electronically file an amended Form 940.

Electronic deposit required

Federal tax deposits must be made by electronic funds transfers (EFT).

You can make payments through your business tax account, through Direct Pay for businesses, using the government's free Electronic Federal Tax Payment System (EFTPS) or through one of the following methods that may charge a fee:

• Ask your financial institution to initiate an automated clearing house (ACH) credit payment on your behalf
• Ask a trusted third party, such as a tax professional or payroll service, to make the payment for you
• Ask your financial institution to make a same-day tax wire payment for you

E-file information returns

Information returns, Form 1099 series and Form W-2, required to be filed electronically by filers of 10 or more information returns in a calendar year. Filers are required to aggregate almost all information return types covered by the regulation to determine whether a filer meets the 10-return threshold. This includes Forms W-2, e-filed with the Social Security Administration.

E-file Forms 1099 with IRIS

The Information Returns Intake System (IRIS) Taxpayer Portal is a system that provides a no cost online method for taxpayers to electronically file Form 1099 series. This free electronic filing service is secure, accurate and requires no special software. This may be especially helpful to any small business that currently sends their 1099 forms on paper to the IRS. Through it they can submit automatic extensions, make corrections and reduce expenses related to paper filing. The Taxpayer Portal allows you to enter data to create Forms 1099 by either keying in the information or uploading a .csv file. For more information see Publication 5717, IRS Portal User Guide.

The IRS holds monthly working group meetings to provide updates and support for the Information Returns Intake System (IRIS). The meeting is for software developers, transmitters and state agencies interested in the IRIS Application to Application (A2A) intake system. Meetings are usually held on the second Wednesday of the month at 1 p.m. Eastern time.

Taxpayer identification number (TIN) on-line matching

TIN matching gives the authorized user the opportunity to match 1099 payee information against IRS records prior to filing information returns. An authorized payor is one who has filed information returns with the IRS in at least one of the two past tax years.

Other information for payroll professionals and employers

Retirement plans for small businesses

Are you looking for information on employee retirement plans in order to provide better service to all your clients?

EITC toolkit for employers

Four out of five eligible workers file for and get the EITC they earned. Employers can help more eligible workers get this important financial boost by telling their workers about EITC.

Social Security Administration (SSA) – Business services online

The Business Services Online (BSO) Suite of Services allows organizations, businesses, individuals, employers, attorneys, non-attorneys representing Social Security claimants, and third parties to exchange information with Social Security securely over the internet. These services include:

• File W-2s/W-2Cs online — This service offers fast, free, and secure online W-2 filing options to CPAs, accountants, enrolled agents, and individuals who process W-2s (the Wage and Tax Statement) and W-2Cs (Statement of Corrected Income and Tax Amounts).
• Verify employees’ Social Security numbers — The Social Security Number Verification Service allows employers to verify the names and Social Security numbers of current and former employees for wage reporting purposes only.