IRS to Update Schedule R To Add Certified PEO Code

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By Jazlyn Williams

Schedule R, the allocation schedule for aggregate filers with Forms 940 and 941, is to be revised to include a new Code D for use in 2018, an Internal Revenue Service official said Aug. 3.

Code D is to indicate wages reported by certified professional employer organizations on behalf of clients, the official said during an IRS payroll industry teleconference.

Separately, the agency published the names of the first group of 84 certified PEOs. The list is to be updated quarterly, with the next group expected Sept. 15, the agency said.

A certified PEO is generally treated as the employer of any workers for a client of the certified PEO and covered by a contract between the two, but only for wages and other compensation paid to the worker by the certified PEO.

In other topics discussed during the teleconference:

•Drafts of the 2017 versions of employer forms for the Affordable Care Act were released by the IRS with minimal changes. The drafts, which are available at the IRS website, were for Forms 1094-B, 1094-C, 1095-B, and 1095-C.

The changes to the forms were to revise dates and website links, the official said. Employers were reminded that draft forms are not to be filed.

•Tax professionals are to print PDF files of forms using actual-size settings, rather than the shrink-to-fit option to ensure that data on the documents may be correctly scanned by the IRS. Otherwise, the improperly printed documents would have to be processed manually, the official said.

To contact the reporter on this story: Jazlyn Williams in Washington at jwilliams@bna.com. To contact the editor responsible for this story: Michael Baer at mbaer@bna.com.

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