Hopefully that blog title got your attention! Last month, The Utah State Tax Commission announced that Utah employers will now have to meet new electronic filing requirements. Our 2015 Legislature passed a law this year (that will take effect in 2016) that will require all employers in the state to electronically file their state annual withholding reconciliations by January 31st of 2016. This will include W-2 forms and 1099 forms. No more mailing for employers.
Charlie Roberts, spokesman for the Utah State Tax Commission said in a statement that out of all the Utah employers “only about 25 percent filed withholding documents electronically in 2015.” This will be a huge change in the way taxes will be filed for over 60,000 businesses that did not file electronically last year.
The Utah State Tax Commission has mentioned that they’ve sent notices of this new law to all businesses. They also stated that they will be offering in-person and online training sessions for anyone interested. Employers who fail to file these forms electronically by the deadline will be subject to penalties.
The state tax commission has said this new change will help combat identity theft and tax fraud. The new requirements will allow the Tax Commission to match employer filing information with employees’ individual income tax returns. Each year, millions of U.S. residents become victims of identity theft. According to the US Bureau of Justice, in 2014, 17.6 million U.S. residents fell victim to identity theft, which is about 7.6% of all residents age 16 and older. As an employer, you’re required to safeguard your employee’s personal information. This would include social security number, address, date of birth and other crucial information.
Each January, employers are required to mail out tax information and this information contains all of this confidential employee personal information. And typically these envelopes are marked with “2014 Tax Information” or “Important Tax Document” stamped all across the front! It’s like a perfect invitation to have a thief steal your information right out of your mailbox. With this instant access to personal information, identity thieves have access to file fraudulent tax refund. The IRS has stated, “Generally, an identity thief will use your SSN to file a false return early in the year. You may be unaware you are a victim until you try to file your taxes and learn one already has been filed using your SSN.” On their website, they give information on the warning signs and what steps to take if you have become a victim of tax fraud. The IRS has even created a specialized division to help with tax fraud as a result of identity theft called the Identity Protection Specialized Unit. Their information can be found on the IRS website.