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2006 CHANGES TO TAX FORMS

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2006 CHANGES TO TAX FORMS

  1. 1. 2006 CHANGES TO TAX FORMS
  2. 2. What’s Changed for 2006??? <ul><li>Form W-2 </li></ul><ul><li>Form W-2c </li></ul><ul><li>Form 4852 </li></ul><ul><li>Form 941 </li></ul><ul><li>Form 944 </li></ul><ul><li>Form 940 </li></ul>
  3. 3. 2006 Form W-2 Changes <ul><li>Box e — New Suffix Field </li></ul><ul><li>Box 12 — New Codes AA and BB </li></ul><ul><li>Back of Copy 2 — Employee Instructions </li></ul><ul><li>Data Entry Reminder — Decimal Point and Cents are Required </li></ul>
  4. 7. Form W-2c Changes <ul><li>Revised — January 2006 </li></ul><ul><li>Box c — SSN Corrections — ADDED </li></ul><ul><li>Box e — Suffix Field — ADDED </li></ul><ul><li>Magnetic Media Filing — ELIMINATED </li></ul><ul><li>Online Filing — Available on SSA Website </li></ul>
  5. 9. Form W-3c Changes <ul><li>Revised — January 2006 </li></ul><ul><li>Box c — Deleted “Section 218” Checkbox </li></ul><ul><li>Box c — Added “944/944-SS” Checkbox </li></ul>
  6. 11. Form 4852 Changes <ul><li>Revised in December 2005. </li></ul><ul><li>Used for Missing or Incorrect Form W-2 or Form 1099-R. </li></ul><ul><li>Added Checkboxes for Form ID. </li></ul><ul><li>W-2 Filers Should Review Next Year’s Social Security Statement. </li></ul>
  7. 13. Form 941 Changes <ul><li>Title Change—“QUARTERLY” </li></ul><ul><li>Lines 7f & 7g—“(attach Form 941c)” </li></ul><ul><li>Line 12—Credit Card Payments </li></ul><ul><li>Caution—BOTH Pages Must Be Completed. </li></ul><ul><li>Line 16—Added “or Stopped Paying Wages.” </li></ul><ul><li>Alternative Signature [R. P. 2005-39] </li></ul>
  8. 16. NEW Form 944 <ul><li>ANNUAL Employment Tax Return </li></ul><ul><li>Scannable </li></ul><ul><li>Small Employers [< = $1,000 in TOTAL Tax] </li></ul><ul><li>Notified by IRS </li></ul><ul><li>EXCEPTIONS [Call 1-800-829-0115] </li></ul><ul><ul><li>E-file </li></ul></ul><ul><ul><li>Expected Liability EXCEEDS $1,000 </li></ul></ul><ul><li>Deposit Rules Apply </li></ul><ul><li>Credit Card Payments </li></ul>
  9. 19. Changes to Form 940 “Plain & Simple” <ul><li>Completely Redesigned for 2006 </li></ul><ul><li>Plain Language </li></ul><ul><li>Form 940, Part II — DELETED </li></ul><ul><li>Exempt Payments — Checkboxes </li></ul><ul><li>Schedule A — MultiState/Credit Reduction </li></ul><ul><li>New Payment Voucher </li></ul><ul><li>Form 940-EZ Discontinued </li></ul>
  10. 20. The new Form 940 for 2006 – “Plain & Simple”
  11. 21. The new Form 940 for 2006 – “Plain & Simple” <ul><li>New check boxes in top right corner </li></ul><ul><ul><li>No more A, B, C, questions </li></ul></ul><ul><ul><li>Will promote accuracy, reduce unnecessary correspondence </li></ul></ul>
  12. 22. The new Form 940 for 2006 – “Plain & Simple” <ul><li>No more hand-written explanations of exempt payments required </li></ul><ul><ul><li>Check boxes capture exempt payments </li></ul></ul>
  13. 23. The new Form 940 for 2006 – “Plain & Simple” <ul><li>New section for computing adjustments </li></ul><ul><ul><li>Replaced old Part II, lines 1-6 with new Part 3 (lines 9, 10 & 11) </li></ul></ul>
  14. 24. The new Form 940 for 2006 – “Plain & Simple” <ul><li>New Schedule A </li></ul><ul><ul><li>Part 1 for multi-state employers </li></ul></ul><ul><ul><ul><li>Simplifies the process - Just check the boxes to tell us where you were required to pay state unemployment tax. </li></ul></ul></ul><ul><ul><li>Part 2 for credit reduction information </li></ul></ul><ul><ul><ul><li>Will simplify computation, increase processing accuracy, and reduce unnecessary taxpayer correspondence. </li></ul></ul></ul>
  15. 25. The new Form 940 for 2006 – Schedule A - “Plain & Simple”
  16. 26. The new Form 940 for 2006 – “Plain & Simple” <ul><li>Form 940-V Payment Voucher removed from form </li></ul><ul><ul><li>Less likelihood of being detached </li></ul></ul><ul><ul><li>Will expedite processing, prevent unnecessary correspondence </li></ul></ul>
  17. 27. Next Steps <ul><li>Completed design phase </li></ul><ul><li>On track for 2006 release of new Form </li></ul><ul><li>Working with software developers to ensure consistent format </li></ul><ul><li>Processing of new Form 940 begins in January, 2007 </li></ul>
  18. 28. 2006 Changes to Forms 1098/1099 <ul><li>Form 1098-C </li></ul><ul><ul><li>4 Boxes Added </li></ul></ul><ul><ul><li>Increased to Full Page </li></ul></ul><ul><li>Form 1098-T [R.P. 2005-50] </li></ul><ul><ul><li>Change Accounting method (Paid vs. Billed) </li></ul></ul><ul><li>Form 1099-R </li></ul><ul><ul><li>Codes “V” & “W” Added (Roth Distributions) </li></ul></ul><ul><li>NO NEW FORMS for 2006 </li></ul><ul><li>Magnetic Media [Pub. 1220] </li></ul><ul><ul><li>2006—No Diskette </li></ul></ul><ul><ul><li>2008—No Tape </li></ul></ul>
  19. 29. PROPOSED Changes to Tax Forms
  20. 30. 2007 Form W-2 <ul><li>PROBLEM — Employee’s SSN is Visible </li></ul><ul><li> in Window Envelopes </li></ul><ul><li>PROPOSAL — Move SSN to Box a. </li></ul><ul><li>Relocate Box a. </li></ul><ul><li>New Problems??? </li></ul><ul><li>COMMENTS — Send Comments to: </li></ul><ul><li>taxforms@irs.gov. </li></ul><ul><li>[Subject Line = “Forms Comment”] </li></ul>
  21. 32. 94X PROJECT <ul><li>Office of Taxpayer Burden Reduction </li></ul><ul><li>2008 Target </li></ul><ul><li>CURRENT — Adjustments [941c] </li></ul><ul><li>PROPOSED — Amendment [941X] </li></ul><ul><li>COMMENTS — Send Comments to: </li></ul><ul><li>[email_address] </li></ul><ul><li>[Subject Line = “Forms Comment”] </li></ul>
  22. 33. QUESTIONS ??? Send comments to: [email_address]

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