For 2018, a number of forms have undergone changes. These include: 1099-DIV, 1099-T, 1099-R, 5498, W-2, 1042-s, and W-2G. See below for more details.
Other changes include increased IRS penalties for W-2 late or missed filings. Please refer to the section below on W-2 changes for more information.
Also, extensions for 1099-MISC with NEC (data in box 7) are no longer automatic. Form 1099-MISC reporting NEC in Box 7 can only request a non-automatic extension of time and must be filed on paper Form 8809. An automatic 30-day extension is not available. Treasure Decision (TD) 9838.
The state of Vermont is no longer participating in the Combined Federal / State Filing program (CF/SF).
1099-DIV Dividends and Distributions
New box 5 section 199A dividends: Box 5, section 199A dividends, must be completed to report section 199A dividends paid to the recipient. The amount paid should also be included in box 1a.
All other boxes from Box 6 – 15 have been incremented by 1. (e.g. Box 6 is now Box 7).
1098-T Tuition Reimbursement
It is now required the all education institutes now issue a 1098-T. Education institutes were supposed to issue these in the past but now it is mandatory.
Box 2 has been removed. In 2017, the IRS gave “limited penalty relief” to those who continued to use Box 2 but this box has now been removed. The IRS is no longer interested in the amount billed. Only the amounts received for qualified tuition and related expenses from all sources during the calendar year less any reimbursements or refunds made during the calendar year. Do not reduce this amount scholarships or grants reported in box 5. Past due qualified tuition or related expenses received in the calendar year should be included in box 2.
1099-R Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, etc
A new box , “Reportable policy sale box” has been added to show the date of a payment of reportable death benefits and instructions have been added to the recipient copy.
Two new distribution codes, C and M ,have been added for box 7. Filers should use Distribution Code 2 on Form 1099-R to report retirement plan (including IRAs) participant distributions made in 2017 due to Hurricanes Harvey, Irma, or Maria.
A conversion of a traditional IRA to a Roth IRA, and a rollover from any other eligible retirement plan to a Roth IRA, made after December 31, 2017, cannot be recharacterized as having been made to a traditional IRA.
Special rules apply to retirement plan distributions made to employees affected by certain natural disasters that occurred in 2016 and 2017. See Pub. 976, Disaster Relief, for more information.
Form 5498 IRA Contribution Information
A new rollover code “PO” has been added for reporting qualified plan load offset roll overs.
Form W-2 Wage and Tax Statement
Moving expense reimbursement exclusions for qualified moving expense reimbursements has been suspended. The Tax Cuts and Jobs Act (Public Law 115-97) temporarily suspends the exclusion for qualified moving expense reimbursements under section 132(a)(6) and (g) except for qualified member of the Armed Forces. See P.L. 115-97, section 11048.
The Tax Cuts and Jobs Act also temporarily makes the Sinai Peninsula of Egypt a qualified hazardous duty area. Treat this hazardous duty area as a combat zone for the exclusion from income of certain combat pay under section 112 and exclusion from wages under section 3401(a)(1)
The Tax Cuts and Jobs Act added section 83(i) for “qualified equity grants.” The law also added new Form W-2 reporting requirements for these grants. Employers with employees who have qualified equity grants must report the amount includible in gross income under section 83(i) for an event which occurs in the calendar year in box 12 using code GG.
Also, employers must report the aggregate amount of income which employees elect to defer under section 83(i) as of the close of the calendar year in box 12, using code HH. See P.L. 115-97, section 13603 for more information.
Penalties for W-2
Failure to file and failure to furnish penalties and penalties for intentional disregard of filing and payee statement requirements have increased due to adjustments for inflation.
The penalty is: $50 per Form W-2 if you correctly file within 30 days of the due date; the maximum penalty is $545,500 per year ($191,000 for small businesses, defined in Small businesses). $100 per Form W-2 if you correctly file more than 30 days after the due date but by August 1; the maximum penalty is $1,637,500 per year ($545,500 for small businesses). $270 per Form W-2 if you file after August 1, do not file corrections, or do not file required Forms W-2; the maximum penalty is $3,275,500 per year ($1,091,500 for small businesses).