Problems arise with new IRS 1099 portal

The Internal Revenue Service has been working to resolve a problem that was preventing businesses and tax professionals from using a new online portal to file their 1099 forms for free.

The IRS opened the Information Returns Intake System portal a little over a year ago as a way to reduce the overload of paper information reporting forms it needs to deal with every year.

The IRIS portal has a web page where users can check on its availability, but some tax professionals have been encountering frustrating errors accessing the portal in recent days as businesses raced to file their 1099 forms in time for the Jan. 31 deadline to furnish the forms to recipients. Nevertheless, the IRIS status page still claimed the system was operational. 

Andrew Harrer/Bloomberg

A reader who asked not to be identified emailed Accounting Today on Tuesday to detail the problems encountered in the past five days, calling the new portal a "disaster." Issues included the system not responding, timeouts and error messages at ia.www4.irs.gov, along with a red triangle in the middle of the page. On Monday, the system told users it was "busy," but before that, there was no information, only a spinning cursor.

The reader tried calling the help line Monday and early Tuesday, but it was too busy to take calls and suggested calling back later or the next day. However, given the Jan. 31 due date for the 1099 forms, the need for the portal was urgent.

Despite the reader having managed to submit a few 1099 forms, they showed up as both unsubmitted and submitted. To download and print out the form, the user had to wait for a notification, which could take hours. The system did not send a text message to authenticate the user, so they could not sign in.

A spokesperson for the IRS checked into the problem after Accounting Today contacted the agency, and said the IRS was able to resolve the problem overnight. 

"The IRS is aware some users were having challenges using the IRIS system this week," said a statement from the agency. "The IRS took a number of corrective steps and that should resolve those issues. The IRIS system is working well today. The IRS appreciates the patience of users who encountered issues during the last few days."

However, according to the reader, some problems persisted on Wednesday. The user logged in and waited 15 minutes for the dashboard to appear, then tried logging in again, but found the site was still not working as expected.

The IRS has reportedly been dealing with a separate technical issue involving its Filing Information Returns Electronically system that was making it difficult for tax and accounting professionals, banks, mortgage providers and payroll companies to upload 1099 forms to the FIRE system. According to the IRS, this is an unrelated problem and is due to users not being authenticated yet with the new system.

"IRS systems continue operating well, and the agency has seen a strong, successful testing season in advance of the 2024 tax season opening," the IRS said in a statement Friday. "The confusion stems from third parties trying to access an IRS system to upload documents on the Filing Information Returns Electronically system. Groups that use FIRE were required to pass higher verification standards before an Aug. 1, 2023, deadline to update their information. The IRS repeatedly urged FIRE users to update their information before the 2024 tax season because they would no longer meet the strengthened security requirements. The IRS emphasizes this is not a widespread issue affecting taxpayers. For companies that cannot access the FIRE system, they need to follow the directions on IRS.gov to meet the new standards and regain access."