IRS Reporting Updates are coming in 2025, and if you’re in HR or benefits, it’s time to get prepared. What if you used the wrong format—just because you didn’t realize the IRS changed the rules? What if you missed a new filing deadline? That one mistake could cost your company hundreds (or even thousands) in penalties—not to mention hours of extra work to fix it.
At FBC, we work with HR teams in Arizona and across the United States. We assist companies who are trying to keep up with the following:
- Evolving regulations
- Shrinking timelines
- Rising employee expectations
It’s a lot. But the good news is that you can stay compliant with the right tools and some smart planning. That even makes reporting easier.
Here’s what’s changing in 2025. Learn how it might affect your HR team and how automated tech solutions can help you get ahead of the curve.
Key IRS Reporting Changes for 2025
New Electronic Filing Thresholds
Starting in 2025, more employers will be required to file electronically. Previously, if you submitted fewer than 250 forms (like W-2s or 1095-Cs), you could do it by paper. That’s no longer the case. The new rule says that if you file 10 or more forms in total—even across different types—you must e-file.
So, if you have:
- 3 W-2s
- 4 1099s
- 3 ACA 1095-Cs
That’s 10 forms, which means you’ll need to file electronically. This catches a lot of small and mid-sized companies off guard, so now’s the time to check where you stand.
ACA Reporting Updates (Forms 1094/1095)
The IRS is also tightening up Affordable Care Act (ACA) reporting rules. One major change: the deadline to distribute 1095-C forms to employees is getting earlier. Plus, the penalty for incorrect or late filing is going up—again.
In past years, there was some wiggle room or automatic extensions, but that’s going away. Employers need to plan ahead and make sure data is accurate and ready well before the deadline.
Changes to W-2 and 1099 Filing
The IRS is adjusting some of the technical specs around W-2 and 1099 filings. That includes the format required for electronic submission. These changes primarily affect HR software vendors and payroll companies. However, it’s still your job to make sure your provider is up to date.
If you’re using outdated systems or manual spreadsheets, it might be time to upgrade.
How These Changes Impact HR and Benefits Teams
Increased Compliance Pressure
Let’s be real—HR professionals already have a lot on their plates. With these updates, compliance tasks are only growing. This is especially true for teams that don’t have dedicated tax or legal staff.
Even a small mistake—like entering the wrong Social Security number or missing a deadline—can lead to big fines. For example, one company filed a few forms by hand to play it safe. But they didn’t know the rule had changed. They ended up with a fine they didn’t expect and had to go back and fix everything.
Tighter Turnarounds
Deadlines are getting stricter. That means HR teams need faster ways to gather, double-check, and submit data on time. If your team still relies on spreadsheets or paper-based workflows, you will feel the crunch.
The Case for IRS Reporting Automation and HR Tech Tools
Streamlining IRS Reporting with Software
Using automated HR and payroll platforms can save hours (or even days) of work during tax season. These systems:
- Pull data from time tracking, benefits enrollment, and payroll
- Auto-fill IRS forms like 1095-Cs or W-2s
- File everything electronically with built-in checks for accuracy
And best of all? They send alerts if something’s missing or looks wrong. That’s a huge relief when you’re juggling open enrollment, PTO requests, etc.
Integration with Payroll and Benefits Systems
Many of today’s platforms can sync your payroll, benefits, and timekeeping systems. That means your data flows automatically from one tool to the next. You’re no longer manually typing or importing CSV files. It cuts down on errors. This helps ensure the data you submit to the IRS matches what your employees see in their pay stubs and benefits summaries.
At FBC, we help clients audit their current systems. We look for where they can automate and what tools will actually make their lives easier—not harder.
Choosing the Right Tech-Driven Solution for IRS Reporting
Key Features to Look For
Not all software is created equal. If you’re shopping for a new IRS reporting tool or an all-in-one HR platform, you want to make sure it includes:
- Real-time compliance alerts
- Customizable dashboards so you can track deadlines
- Auto-fill forms and e-file capabilities
- Audit logs to track who made what changes and when
Bonus points if it comes with customer support during peak filing times.
Real-Life Success Story
A healthcare company with about 75 employees was struggling with ACA reporting. They used a basic payroll system and filled out 1095-C forms by hand every year. It took a lot of time and often led to mistakes.
Things got much easier after switching to an automated system that worked with their time and benefits tools. In their first year using it, they filed everything online and met all the deadlines. They didn’t get any penalties. The HR manager said it was the first January they didn’t lose sleep over IRS reporting!
That’s what we like to hear.
IRS Reporting Key Points
- IRS Reporting Updates in 2025 include lower electronic filing thresholds and new ACA deadlines. There are changes to W-2 and 1099 filing formats, as well.
- These updates increase pressure, especially on HR and benefits teams using manual processes.
- Automated HR tools make compliance easier. They reduce human error, speed up workflows, and keep you current with IRS rules.
- Integrated platforms ensure your payroll, benefits, and timekeeping data match across systems. This keeps your reports accurate.
- The right solution can save time, reduce stress, and help you avoid costly penalties. It also shows your workforce you’ve got their backs.
At FBC, we help HR leaders like you stay ahead of the curve with smart, scalable solutions. If you’re unsure whether your current system can handle 2025’s changes, reach out—we’re happy to help you map out your next steps.