Here’s what HIVE AI had to say about “What is the penalty for late filing of W-2/1099 returns by employers?”:
For returns due in 2026, the federal late-filing penalty for Forms W-2 and most Forms 1099 is generally imposed per return, based on how late the filing is:
- $60 per return if correctly filed within 30 days after the due date
- $130 per return if correctly filed more than 30 days late but by August
- $340 per return if filed after August 1, not corrected, or not filed at all
If the failure is due to intentional disregard, the penalty is at least $680 per return, with no maximum cap.
There are annual maximums, and they are lower for small businesses. For W-2 filings due after December 31, 2026, the W-2 instructions list maximum penalties of $698,500, $2,095,500, and $4,191,500, with lower caps for small businesses.
A separate penalty can also apply for failing to furnish the employee or payee copy on time under section 6722, in the same penalty tiers. 4
The penalty can be waived if the failure was due to reasonable cause and not willful neglect.
Sources
1 – CCA 200941012
2 – CCA 201106010
3 – Information return penalties
4 – General Instructions for Forms W-2 and W-3 (2026)