What’s new with Comply?
Introducing new and exciting technologies! We are turning our heads to the future, and developing new ways to simplify the documentation collection process. Our newest innovation streamlines how documentation is managed and resolves the reluctance of individuals to store and share their information. Sign up to our beta release program and be part of the journey!
Reporting challenges? Comply and Sovos announced their first-to-market end-to-end information reporting and withholding solution. Working together for the benefit of our clients lowering cost, reducing complexity and improving compliance! Find out more here.
ComplyPro, our CPE accredited platform, combines training, support, tools and templates, fully integrated with ComplyLite for low volume, low-cost form submission and validation. Click here to find out more and register today.
What you need to know this January
The Internal Revenue Service reminded businesses and other payors that the revised Form 1099-MISC, Miscellaneous Income, and the new Form 1099-NEC, Nonemployee Compensation, must be furnished to most recipients by February 1, 2021.
With 2021 well under way, it is a good time to review whether you have any FATCA or CRS reporting requirements and plan accordingly.
See below for Key Dates and Reminders around Form 1099/1042-S reporting, as well as approaching reporting deadlines and announcements for key FATCA and CRS countries.
Key Dates and Reminders – January 2021
1099/1042 – Key Dates & Reminders
Form 1099-MISC
- Forms 1099-MISC must be sent to recipients by February 1, 2021 and filed with the IRS by March 1 (March 31 if filing electronically).
- When reporting amounts in box 8, Substitute Payments in Lieu of Dividends or Interest, or box 10, Gross Proceeds Paid to an Attorney, there is an exception to the regular due date. These forms are due to recipients by February 16, 2021.
Form 1099-NEC
- Forms 1099-NEC must be sent to recipients and filed with the IRS by February 1, 2021.
- There is no automatic 30-day extension to file Form 1099-NEC, but an extension to file may be available under certain hardship conditions.
- Nonemployee compensation may be subject to backup withholding if a payee has not provided a taxpayer identification number to the payer or the IRS notifies the payer that the taxpayer identification number provided was incorrect.
Forms 945
- The Form 945 is used to report withheld federal income tax withheld (or required to be withheld) from nonpayroll payments.
- For 2020, file Form 945 by February 1, 2021. However, if you made deposits on time in full payment of the taxes for the year, you may file the return by February 10, 2021.
Form 1042/1042-S
- Forms 1042-S, whether filed on paper or electronically, must be filed with the IRS and furnished to the recipient of the income by March 15, 2021.
- A 30-day extension of time to file Form 1042-S may be requested by filing a Form 8809, Application for Extension of Time to File Information Returns.
- A 30-day extension of time to furnish recipient statements may be requested by sending a letter to the IRS.
- Form 1042 must be mailed to the IRS by March 15, 2021
- An extension of time may be requested by submitting Form 7004, Application for Automatic Extension of Time to File Certain Business Income Tax, Information, and Other Returns. Form 7004 does not extend the time for payment of tax.
FATCA / CRS Key Dates & Reminders – Select Jurisdictions
With FATCA and CRS deadlines approaching, keep an eye out for the following key country deadlines and announcements:
Bermuda
- In preparation for the transition to version 2.0 of the OECD’s Common Reporting Standard (CRS) and Country-by-Country (CbCR) XML Schemas, the Bermuda Tax Information Reporting Portal will be inaccessible from January 1, 2021 – February 27, 2021, and will reopen on February 28, 2021.
British Virgin Islands
- The International Tax Authority (“ITA”) announced that the British Virgin Islands Financial Account Reporting system (“BVIFARs) will be under maintenance in preparation to accommodate the OECD’s new version 2.0 schema:
- BVIFARs will be inaccessible from December 31, 2020 – January 7, 2021.
- BVIFARs will return online from January 8, 2021 – January 13, 2021 to allow for additional submissions using version 1.0 schema. Any filings submitted after January 13th must be submitted in accordance with version 2.0 schema.
- BVIFARs will undergo configuration for version 2.0 schema between January 16, 2021 – February 5, 2021.
Canada
- Internet filing became available on January 11, 2021. There are two options to submit Part XVIII and Part XIX returns: Internet file transfer or Web Forms.
- The Canada Revenue Agency (CRA) updated the XML schema for FATCA and CRS reporting (version 1-21-3, last updated January 18, 2021)
Cayman Islands
- CRS reporting functionality on the DITC portal has been disabled until March 2021 to transition to the new OECD CRS XML Schema. Any FIs who were unable to submit returns for the 2019 reporting period by December 16, 2020, will not automatically be issued an Administrative Penalty and will be expected to submit a CRS XML once reporting functionality has been reenabled in March 2021.
- The FATCA reporting functionality for the 2019 reporting period is still available on the DITC portal.
- The reporting deadline for 2019 CRS Compliance Form has been extended to September 15, 2021 to accommodate the availability of a bulk upload option in CSV format. The current function to submit the 2019 CRS Compliance Form remains open on the DITC portal. The deadlines for the 2019 CRS Compliance Form and the 2020 CRS Compliance Form are now the same (September 15, 2021).