{
    "schema": "amendsignal.record/1",
    "generated_on": "2026-11-02",
    "publisher": {
        "name": "AmendSignal",
        "url": "https://amendsignal.com/"
    },
    "notice": "Coverage is limited, so a missing record does not mean nothing changed. General information, not legal advice. Check the official source. Please cite the record's url.",
    "change": {
        "id": 26,
        "url": "https://amendsignal.com/changes/internal-revenue-service-proposes-updating-its-information-reporting-and-backup-withholding/",
        "title": "Internal Revenue Service proposes updating its information reporting and backup withholding regulations to the new $2,000 threshold",
        "change_type": "proposed_rule",
        "change_type_label": "Proposed rule",
        "status": "proposed",
        "status_label": "Proposed",
        "status_statement": "As of our last check on November 2, 2026, this is a proposal, not a requirement. Comments closed June 16, 2026.",
        "significance": "Proposed, nothing required yet",
        "jurisdiction": {
            "code": "US",
            "name": "United States"
        },
        "authority": {
            "name": "Internal Revenue Service",
            "short_name": "IRS"
        },
        "identifiers": [
            {
                "type": "fr_document_number",
                "label": "FR document",
                "value": "2026-07519"
            },
            {
                "type": "fr_citation",
                "label": "Citation",
                "value": "91 FR 20599"
            },
            {
                "type": "rin",
                "label": "RIN",
                "value": "1545-BR73"
            },
            {
                "type": "docket_id",
                "label": "Docket",
                "value": "REG-113229-25"
            },
            {
                "type": "cfr_citation",
                "label": "CFR",
                "value": "26 CFR 1"
            },
            {
                "type": "cfr_citation",
                "label": "CFR",
                "value": "26 CFR 31"
            }
        ],
        "dates": [
            {
                "type": "publication",
                "label": "Published",
                "value": "2026-04-17",
                "precision": "day"
            },
            {
                "type": "comment_close",
                "label": "Comments due",
                "value": "2026-06-16",
                "precision": "day"
            }
        ],
        "in_short": {
            "what_changed": "The Internal Revenue Service (IRS) proposes to replace the old $600 reporting threshold in its regulations with the statutory threshold of $2,000 for 2026, adjusted for inflation in later years, for information returns and backup withholding. The proposal reflects changes Congress already made in the One, Big, Beautiful Bill Act.",
            "whos_affected": "Businesses that make payments in the course of their trade or business reported on Forms 1099-NEC, 1099-MISC, W-2G, and in narrow cases Form W-2, and payors that do backup withholding reported on Form 945. Casinos and other payors of gambling winnings are among the most affected.",
            "what_to_do": "This proposed rule creates no new duties for employers, and comments are due June 16, 2026. The IRS says the higher statutory thresholds already apply to payments made after December 31, 2025, regardless of this proposal, so payors may want to confirm their systems no longer use $600."
        },
        "summary": "The Internal Revenue Service (IRS) proposes to update its regulations to match the One, Big, Beautiful Bill Act, which raised the information reporting threshold for many business payments from $600 to $2,000 for payments made after December 31, 2025, indexed for inflation after 2026. The proposal would also apply the $2,000 threshold to backup withholding and to gambling winnings reported on Form W-2G, and would limit the wagering loss deduction to 90 percent of losses. It is a proposed rule, and comments are due June 16, 2026.",
        "business_functions": {
            "state": "limited",
            "functions": [
                {
                    "slug": "payroll",
                    "name": "Payroll"
                },
                {
                    "slug": "employment-tax",
                    "name": "Employment tax"
                },
                {
                    "slug": "technology",
                    "name": "Technology"
                }
            ]
        },
        "added_on": "2026-11-02",
        "updated_on": null,
        "updates_in_progress": null,
        "last_checked": "2026-11-02",
        "record_url": "https://amendsignal.com/changes/internal-revenue-service-proposes-updating-its-information-reporting-and-backup-withholding/record.json",
        "what_changed": [
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The One, Big, Beautiful Bill Act raised the reporting threshold for payments in the course of a trade or business from $600 to $2,000 for payments made after December 31, 2025, and indexes it to inflation for calendar years after 2026.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Background, II. Section 6041",
                        "excerpt": "OBBBA section 70433(a) increased the $600 threshold in section 6041 to a base threshold of $2,000 for payments made after December 31, 2025."
                    },
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Background, II. Section 6041",
                        "excerpt": "Additionally, OBBBA section 70433(b) added section 6041(h), which provides that, for calendar years after 2026, this base threshold will be indexed to inflation."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The proposal would replace the $600 references in the information reporting and backup withholding regulations with a reference to the dollar threshold in effect for the calendar year.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Explanation of Provisions, II",
                        "excerpt": "these references ... would be replaced with a reference to an amount equaling or exceeding the dollar threshold in effect for the calendar year under section 6041(a) and (h)"
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The proposal would define the threshold as $600 for payments before 2026, $2,000 for payments made in 2026, and $2,000 plus the inflation adjustment for payments after 2026.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Proposed Sec. 1.6041-1(a)(3)",
                        "excerpt": "For payments made after December 31, 2025, and before January 1, 2027, the dollar threshold in effect for the calendar year under section 6041(a) is $2,000."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "Backup withholding on these payments would apply only once total payments to a payee in the calendar year reach the threshold in effect for that year.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Proposed Sec. 31.3406(b)(3)-1(b)(3)(i)",
                        "excerpt": "only if the aggregate amount of the current payment and all previous payments to the payee during the calendar year equals or exceeds the dollar threshold in effect for the calendar year under section 6041(a) and (h)"
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The reporting threshold for winnings from bingo and slot machines ($1,200) and keno ($1,500) would rise to $2,000 for 2026, adjusted for inflation later.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.A",
                        "excerpt": "regulations under section 6041 provided that the dollar threshold was $1,200 for a single winning from bingo and slot machine play and $1,500 for a single winning from keno."
                    },
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Explanation of Provisions, II",
                        "excerpt": "the threshold for reporting payments of winnings from bingo, keno, and slot machine play is $2,000 for calendar year 2026"
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The proposal would also limit the itemized deduction for wagering losses to 90 percent of losses, and only up to wagering gains, matching the statute.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Proposed Sec. 1.165-10(a)",
                        "excerpt": "a deduction is allowed under section 165(d) of the Internal Revenue Code for 90 percent of the amount of such losses during the taxable year, but only to the extent of the gains from wagering transactions during that year."
                    }
                ]
            }
        ],
        "who_is_affected": [
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The changes affect people who make payments in the course of their trade or business, and people who claim a deduction for wagering losses.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "SUMMARY",
                        "excerpt": "These changes will affect persons who make payments in the course of their trade or business and those persons claiming a deduction for wagering losses."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The Treasury Department and the IRS estimate that 3.6 million payors are potentially affected, about 98 percent of them small entities.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "the Treasury Department and the IRS estimate that 3.6 million payors are potentially affected by the statutory change and the clarity provided by these proposed regulations."
                    },
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, III. Regulatory Flexibility Act",
                        "excerpt": "approximately 98 percent are considered small entities with gross receipts under $40 million"
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The Form W-2 effect is narrow: it covers pay where Social Security and Medicare withholding is not required, such as foreign agricultural workers, election workers and certain clergy.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "This situation applies in a narrow set of circumstances where withholding for social security and Medicare taxes is not required, such as for cases of foreign agricultural workers, election workers, and certain members of the clergy."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "Payors of gambling winnings are heavily affected: more than 4,000 payors filed 17.3 million Forms W-2G in the range between the old and new thresholds for tax year 2024.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "For the same tax year, more than 4,000 payors filed 17.3 million Forms W-2G reporting gambling winnings in the range between the old and new reporting thresholds, almost 80 percent of which were for winnings from slot machine play."
                    }
                ]
            }
        ],
        "business_implications": [
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The IRS says the higher dollar thresholds come from the statute and apply regardless of this proposal.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "Because this is a change in the statute, these dollar thresholds apply regardless of these proposed regulations."
                    }
                ]
            },
            {
                "kind": "inference",
                "kind_label": "Our analysis",
                "text": "Payors whose accounts payable or payroll systems still use the old $600 trigger may issue forms they no longer need to file. The IRS itself warns that some payors may keep applying the outdated thresholds.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "Some taxpayers and practitioners may apply the lower, outdated thresholds in the regulations despite the new, higher thresholds in the statutes."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The Treasury Department and the IRS estimate the higher threshold will cut filing burden by $982 million (in 2024 dollars) for tax year 2026 returns filed in 2027.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, II. Paperwork Reduction Act",
                        "excerpt": "the Treasury Department and the IRS estimate that the higher reporting threshold will result in an overall reduction in filing burden of $982 million in 2024 dollars"
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The draft 2026 General Instructions for Certain Information Returns (Publication 1099) already reflect the new threshold.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "Published draft Publication 1099, General Instructions for Certain Information Returns, for Tax Year 2026 already contains references to the statutory changes to the reporting threshold made by the OBBBA."
                    }
                ]
            },
            {
                "kind": "fact",
                "kind_label": "From the source",
                "text": "The IRS states the proposal imposes no new requirements on small entities and instead raises the threshold for issuing information returns.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, III. Regulatory Flexibility Act",
                        "excerpt": "because they do not impose any new requirements on small entities but rather increase the threshold at which they are required to issue information returns"
                    }
                ]
            }
        ],
        "required_actions": [],
        "recommended_actions": [
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider confirming that accounts payable and payroll systems use the $2,000 threshold, not $600, when deciding which 2026 payments go on Forms 1099-NEC and 1099-MISC.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "Because this is a change in the statute, these dollar thresholds apply regardless of these proposed regulations."
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider reviewing backup withholding settings so withholding starts when total payments to a payee in the year reach the threshold in effect for that year.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Proposed Sec. 31.3406(b)(3)-1(b)(3)(i)",
                        "excerpt": "only if the aggregate amount of the current payment and all previous payments to the payee during the calendar year equals or exceeds the dollar threshold in effect for the calendar year under section 6041(a) and (h)"
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "If you pay workers whose pay is not subject to Social Security and Medicare withholding (for example, election workers or certain clergy), consider reviewing how your Form W-2 rules apply the $2,000 threshold.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Proposed Sec. 1.6041-2(a)(1)",
                        "excerpt": "must also be reported on Form W-2 if the total of such payments and the amount of the employee's wages (as defined in section 3401), if any, required to be reported on Form W-2 equals or exceeds the dollar threshold in effect for the calendar year under section 6041(a) and (h)"
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider submitting comments, or a request for a public hearing, by June 16, 2026 if the proposal affects your reporting.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "DATES",
                        "excerpt": "Electronic or written comments and requests for a public hearing must be received by June 16, 2026."
                    }
                ]
            },
            {
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "text": "Consider watching for the inflation-adjusted threshold for payments made after 2026, since the proposal does not state the amount.",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Proposed Sec. 1.6041-1(a)(3)",
                        "excerpt": "For payments made after December 31, 2026, the dollar threshold in effect for the calendar year under section 6041(a) is $2,000 plus the inflation adjustment provided in section 6041(h)."
                    }
                ]
            }
        ],
        "required_actions_assessment": {
            "state": "assessed",
            "text": "This is a proposed rule. It creates no requirement for employers until it is finalized. The higher thresholds it describes come from the statute, not from this proposal."
        },
        "applicability": [
            {
                "criterion": "where",
                "label": "Where",
                "answer": "United States, nationwide",
                "kind": "fact",
                "kind_label": "From the source",
                "evidence": []
            },
            {
                "criterion": "employer_type",
                "label": "Employers",
                "answer": "Any person engaged in a trade or business that makes reportable payments in the course of that business.",
                "kind": "fact",
                "kind_label": "From the source",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "SUMMARY",
                        "excerpt": "These changes will affect persons who make payments in the course of their trade or business"
                    }
                ]
            },
            {
                "criterion": "size",
                "label": "Size",
                "answer": "No size threshold is set; the IRS estimates about 98 percent of affected payors are small entities.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, III. Regulatory Flexibility Act",
                        "excerpt": "approximately 98 percent are considered small entities with gross receipts under $40 million"
                    }
                ]
            },
            {
                "criterion": "industries",
                "label": "Industries",
                "answer": "All industries; casinos and other payors of gambling winnings are the most affected.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.C.2.a",
                        "excerpt": "For the same tax year, more than 4,000 payors filed 17.3 million Forms W-2G reporting gambling winnings in the range between the old and new reporting thresholds, almost 80 percent of which were for winnings from slot machine play."
                    }
                ]
            },
            {
                "criterion": "functions",
                "label": "Functions",
                "answer": "Employment tax, payroll and accounts payable teams that file Forms 1099-MISC, 1099-NEC, W-2, W-2G and 945.",
                "kind": "inference",
                "kind_label": "Our analysis",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.A",
                        "excerpt": "These statutory dollar thresholds apply to certain payments reported on four information returns"
                    }
                ]
            },
            {
                "criterion": "applies_if",
                "label": "Applies if",
                "answer": "You make business payments reported on Forms 1099-MISC, 1099-NEC, W-2 or W-2G, or do backup withholding reported on Form 945.",
                "kind": "fact",
                "kind_label": "From the source",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "Special Analyses, I.A",
                        "excerpt": "as well as backup withholding with respect to these payments reported on Form 945 (Annual Return of Withheld Federal Income Tax)"
                    }
                ]
            },
            {
                "criterion": "action",
                "label": "Action",
                "answer": "Confirm systems use the $2,000 threshold for 2026 payments; comment by June 16, 2026 if needed.",
                "kind": "recommendation",
                "kind_label": "Our suggestion",
                "evidence": [
                    {
                        "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                        "locator": "DATES",
                        "excerpt": "Electronic or written comments and requests for a public hearing must be received by June 16, 2026."
                    }
                ]
            }
        ],
        "open_questions": [
            {
                "question": "What will the reporting threshold be for payments made in 2027 and later years?",
                "context": "The proposal says the $2,000 amount will be adjusted for inflation after 2026 but does not state the adjusted figure."
            }
        ],
        "events": [
            {
                "event_type": "originating_action",
                "label": "Issued",
                "occurred_on": "2026-04-17",
                "summary": "Increase in Threshold for Requiring Information Reporting With Respect to Certain Payees; Extension and Modification of Limitation on Wagering Losses",
                "source": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension"
            }
        ],
        "corrections": [],
        "sources": [
            {
                "label": "Increase in Threshold for Requiring Information Reporting With Respect to Certain Payees; Extension and Modification of Limitation on Wagering Losses, 91 FR 20599 (April 17, 2026)",
                "publisher": "Federal Register",
                "role": "primary",
                "url": "https://www.federalregister.gov/documents/2026/04/17/2026-07519/increase-in-threshold-for-requiring-information-reporting-with-respect-to-certain-payees-extension",
                "pdf_url": "https://www.govinfo.gov/content/pkg/FR-2026-04-17/pdf/2026-07519.pdf"
            }
        ]
    }
}