Taxpayers who are required to file information returns and furnish payee statements, but fail to do so, can get slapped with a penalty. However, the IRS just released final regulations about a safe harbor option. If taxpayers file these returns and furnish these statements on time and they contain only “de minimis” (minor) errors, the safe harbor may apply. However, it doesn’t apply to late filings or furnishings or if taxpayers intentionally disregard the rules. People to whom payee statements must be furnished can reject safe harbors by making the elections within 30 days after their due date or Oct. 15 of the calendar year. The final regs generally are effective beginning Jan. 1, 2024.
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