Preparing for tax year changeover
When a new tax year starts, you need to collect financial data for the new year in a new tax form for the new tax year. This is often before a user completes and submits tax forms from the previous year and before you provide them to users on your platform. To view the tax forms for the new year, you need to change the year selected either on the Tax forms page or on the Tax form settings page.
About tax year settings
When a new tax year starts, we apply your settings from the previous year to the new one. If no settings are in place from the previous tax year, the Tax year settings dialog displays so you can configure settings for that tax year.
Tax forms are generated as soon as a new tax year starts and a payment is made. To see the tax forms that belong to the new tax year, users need to go through a changeover process. This means they need to enable the tax year picker either on the tax forms list or on the Tax Forms settings pages, and they need to create new settings.
What’s new in 2021
The 2021 tax year includes the following changes:
- Tax form settings: You can choose a delivery preference of either E-delivery or Postal mail delivery for tax forms.
- The Tax form settings dialog now includes the following settings:
- Default form type
- Default calculation method
- Default box (1099-MISC only)
- Default delivery method
Selecting a tax year
The Tax forms page displays tax forms and settings for the current tax year. The current tax year refers to the tax year that occurs six months prior to the current date. For example, if you visit the page on June 30, the page displays the tax forms from the previous calendar year. If you visit the page the next day, July 1, the page shows tax forms for the current calendar year.
You can display a different tax year by doing one of the following:
- Selecting a new tax year from the drop-down on the Tax forms page
- Selecting a new tax year from the drop-down on the Tax form settings page
When you select a tax year from the drop-down for a year that has no activity, the Tax form defaults dialog opens. To activate the tax year, configure and save the Tax form default settings. If you don’t configure and save settings, the settings dialog displays when you open the Tax forms page. Select a different tax year from the drop-down to change to that year.
The selection persists between sessions, so it displays the same tax year when you next use the Dashboard. This lets you start working with tax forms for the current year and then switch back to the previous year to file or correct existing forms.