Is That Social Security Email About Form W-2 Filing Changes For Real?

Earlier this week, many businesses received an email with a header asking, “Did You Take the Necessary Steps Required to Access Business Services Online (BSO) Employer Services? The Filing Deadline for Wage Reporting is Approaching!” The e-mail included exhortations to “Act Now! Time is Running Out!”

This raised suspicions for some. A taxpayer forwarded it to me, asking, “Is this real?”

Yes, it’s real. Here’s what you need to know.

Taxpayer First Act

A few years ago, the IRS issued regulations requiring that information returns be filed electronically if a taxpayer must file 250 or more in a calendar year. The regulations provide that the 250-return threshold is applied separately to each type of information return covered under the regulations.

By 2019, over 98.8% of information returns were already filed electronically. That same year, Congress passed the Taxpayer First Act—it was signed into law by President Donald Trump on Jul. 1, 2019. The law focused on modernizing and improving the IRS.

One of the provisions of the Act (section 2301) sets the number of returns a filer may file without being required to file electronically at 10—down from 250—for 2024. The number remained fixed at 250 information returns for 2022 and 2023 (a tax preparer can apply for a waiver if they can’t file electronically due to lack of internet).

Earlier this year, the IRS issued final regulations amending the rules for filing returns and other documents electronically—among other things, the regs officially shrunk the electronic-filing threshold down to 10 for returns required to be filed on or after Jan. 1, 2024.

Information Returns

Information returns include Forms 1099 and W-2. What the new rules mean for taxpayers, including small businesses, is that if you file ten or more informational returns, you must file electronically unless the IRS grants a waiver or exemption.

(The good part: If you file electronically, there is no need to send paper documents.)

Employers must file W-2 forms with the Social Security Administration (SSA) and the IRS by Jan. 31 following the tax year. That means Tax Year 2023 wage reports must be filed with the Social Security Administration by Jan. 31, 2024.

To file electronically with SSA, you must have access to BSO, or Business Services Online. To use BSO, you have to register.

Business Services Online

BSO now requires additional levels of security to access employer services. Your prior BSO UserID and password can no be longer used to access BSO employer services. You must have a Social Security Online account, Login.gov, or ID.me credential to use the BSO application. You can use your existing Login.gov or ID.me credentials to log in. If you do not have a Social Security online account, a Login.gov, or ID.me credential, you will need to create one.

If you don’t have the proper credentials, you won’t be able to access services, including reporting wages on Form W-2, viewing submission and report status, and verifying Social Security numbers.

SSA suggests allowing at least two weeks for the registration process to be completed. That’s why they sent out the e-mail—if you don’t register in time, you may be unable to file your information returns by the deadline.

Help Is Available

To help taxpayers sort it out, SSA will host a series of virtual webinars on BSO’s new access and registration process on Dec. 6, Dec. 13, and Dec. 18, 2023. You can find out more information and register here—but don’t wait too long. As of this posting, the Dec. 6 webinar had already reached capacity.

SSA has a toll-free line to help employers with wage reporting questions or problems (it’s at 1-800-772-6270 or TTY 1-800-325-0778, Monday through Friday, 7 a.m. to 7:00 p.m., Eastern Time). You can also e-mail [email protected].

There’s also a toll-free line for questions about using Social Security’s Business Services Online website for filing Forms W-2 electronically (it’s at 1-888-772-2970, or TTY 1-800-325-0778, Monday through Friday, 7 a.m. to 7:00 p.m., Eastern Time). You can also fax 1-410-597-0237 or e-mail [email protected].

If you need in-person help, type in your postal ZIP code here to find an office near you.

Forms 1099

If you need to file Forms 1099, you’ll do that through the IRS. To help, the IRS has created a free online portal called the Information Returns Intake System (IRIS). It’s available to any business of any size, but the IRS says it may be especially helpful to any small business that currently sends their 1099 forms on paper to the IRS.