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What’s Hot on Checkpoint for Payroll and Benefits Professionals?

Checkpoint Editorial Team  

Checkpoint Editorial Team  

Navigate the latest trends and emerging issues with new resources and expert guidance from Checkpoint Edge.

In this edition, we take a look at the new 1099 filing platform, WARN laws, and annual cost-of-living adjustments to key figures.

Please note that access to the resources below requires a Checkpoint subscription except as otherwise stated. Not yet a subscriber? Sign up for a free 7-day trial today!

New 1099 Filing Platform to Launch in 2023

Who needs to know: Payroll professionals, payroll departments, tax departments, third-party payroll providers.

The Taxpayer First Act requires the IRS to develop an internet platform by January 1, 2023 that will allow taxpayers to electronically file Forms 1099. This new system will replace the File Information Returns Electronically (FIRE) system. The launch date for the Information Return Intake System (IRIS) is January 9, 2023.

  • Users with an existing FIRE Transmitter Control Code (TCC) will not be able to use that TCC for the IRIS. An IRIS TCC is required to use the new portal. Transmitters can begin applying for IRIS TCC by December 5, 2022. It can take up to 45 days for processing, but the IRS said it will likely only take a few days. Bulk filers must continue to use the FIRE system in 2023 until the Application to Application (A2A) part of the IRIS system is available. New IRS publications regarding IRIS and a new webpage on it will be issued soon.

Checkpoint Edge resources:

New 1099 Filing Portal Slated to Launch January 9

Payroll Guide ¶4264 Basic Principles

Payroll Guide ¶4268 Form 1099-MISC

Payroll Guide ¶4271 Form 1099-NEC

 

Be Aware of Federal/State WARN Act Laws

Who needs to know: Payroll professionals, payroll departments, tax departments, third-party payroll providers.

A class action lawsuit has been filed in a district court that claims Twitter violated both the federal and state WARN Act laws regarding the company’s plans to reportedly lay off a portion of its workforce (Cornet v. Twitter Inc., 22-cv-06857, US District Court, Northern District of California (San Francisco)).

The federal Worker Adjustment and Retraining Notification Act of 1988 (WARN Act) generally requires covered employers to give 60 days’ written notice before implementing plant closings or mass layoffs. Many states have WARN Act laws as well. Understanding WARN Act laws is essential to make sure companies are complying with federal and state laws.

Payroll Guide ¶23,000 and State Wage Payment Sections, Beginning with Payroll Guide ¶17,104

 

IRS Announces Cost of Living Adjustments and Annual Retirement Plan Limits

Who needs to know: Benefit and payroll professionals, human resources departments, tax departments, CPAs.

The IRS announced the 2023 cost of living adjustments (COLAs) for a number of tax-related limits including limits relating to health FSAs, qualified transportation fringe benefits, qualified small employer health reimbursement arrangements (QSEHRAs), adoption assistance, DCAPs, the small business health care tax credit, the premium tax credit, and Archer MSAs. The IRS has also announced the 2023 dollar limits and thresholds for retirement plans.

These annual COLA adjustments include many different benefit amounts that must be updated accurately for the next calendar year. Sponsors and administrators of benefits with limits that are changing will need to determine whether their plans automatically apply the latest limits or must be amended (if desired) to recognize the changes. Any changes in limits should also be communicated to employees. There are notable increases in the retirement plan contribution limits for 2023 compared to recent years. Plan sponsors, administrators, and advisors will want to carefully note when the new limits and thresholds apply. Employee communications, plan procedures, and administrative forms should be reviewed and updated as necessary to reflect these changes.

IRS Rev. Proc. 2022-38; IRS Notice 2022-55, 2022-45

IRS Announces 2023 Retirement Plan Dollar Limits and Thresholds

IRS Releases 2023 Cost-of-Living Adjustments for Health FSAs, Transportation Benefits, Adoption Assistance, and More

EBIA manuals:

401(k) Plans manual at Sections II.H.2 (“Retirement Savings Contributions Credit for Certain Income-Eligible Plan Participants”)

Cafeteria Plans manual at Section XXVIII.M (“Highly Compensated and Key Employees—Identifying the ‘Prohibited Group’ Members”), Section X (“Contributions: The Code’s Annual Limitations”), and Section XVIII.K.2 (“HCE Compensation Threshold”), XVIII.K.2 (“HCE Compensation Threshold”),

Fringe Benefits manual at Sections III (“Qualified Adoption Assistance Programs”) and Section XX (“Qualified Transportation Plans”)

Benefits professionals and payroll practitioners can access comprehensive federal and state guidance with a 7-day trial of Checkpoint Edge!

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