II. Explanation of the Bill
(Sec. 2002 of the Bill & Sec. 6071 of the Code)
Information such as the amount of dividends, partnership distributions, and interest paid
during the calendar year must be supplied to taxpayers by the payors by January 31 of the
following calendar year. The payors must file an information return with the IRS with the
information by February 28 of the year following the calendar year for which the return must be
filed. Under present law, the due date for filing information returns with the IRS is the same
whether such returns are filed on paper, on magnetic media, or electronically. Most information
returns are filed on magnetic media (such as computer tapes), which are physically shipped to the
Reasons for Change
The Committee believes that encouraging information return filers to file electronically will
substantially increase the efficiency of the tax system by avoiding the need to convert the
information from magnetic media or paper to electronic form before return matching.
Explanation of Provision
The provision provides an incentive to filers of information returns to use electronic filing
by extending the due date for filing such returns from February 28 (under present law) to March 31
of the year following the calendar year to which the return relates.
The provision also requires the Treasury to issue a study evaluating the merits and
disadvantages, if any, of extending the deadline for providing taxpayers with copies of information
returns from January 31 to February 15 (Forms W-2 would still be required to be furnished by
The extension of the due date for filing returns applies to information returns required to be
filed after December 31, 1999. The Treasury study is due by December 31, 1998.