Businesses subject to new e-file rules in 2024

Regulations designed to increase electronic filing will impact a variety of businesses starting January 1, 2024.

The new requirements first outlined in the Taxpayer First Act and finalized earlier in 2023 will primarily impact businesses, corporations, and partnerships that file multiple returns each year. Specifically, the rules will:

  • Require businesses that file 10 or more returns in a calendar year to file them electronically, thus eliminating the 250-return threshold as well as previous e-file exceptions for certain returns and documents.
  • Require filers to aggregate their returns regardless of type in applying the 10-return threshold. Previously, the 250-return threshold applied separately to each type of return filed.
  • Eliminate the e-filing exception for income tax returns of corporations that report total assets under $10 million at the end of their taxable year.
  • Require e-filing by partnerships with more than 100 partners, as well as partnerships required to file 10 or more returns of any type during the calendar year.

The IRS said hardship waivers and exemptions will be considered for filers unable to comply with the requirements.

More than 4 billion returns are filed each year, and the IRS said it expects almost 5 billion by 2028. In 2021, about 82% of all corporate income tax returns were filed electronically.

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