Information Return Impact of USPS Postmark Rule Change

In December, the United States Postal Service announced changes to its “postmark rules.” This article will focus on the information reporting impacts, but be aware that this has a large impact on anything which relies on a postmark date — in the tax world or otherwise.

It’s yet another reason why electronic filing with the IRS and electronic delivery to recipients should be your standard procedure with information forms.

Old Rule

Under the old rule, if you dropped something in the mail on a particular day, the envelope would show a postmark of that day, as long as you met the times posted on the box (the times shown for when the Postal Service picks up the mail). 

New Rule

The new rule says the postmark will show when the envelope was processed by an IRS sorting machine. This may be the next day (or some other later date), not the date you dropped it in the mail. 

For anything where the something hinges on the postmark date — such as mailings involving the IRS — you need to be aware of this change. 

You can avoid this problem by going into the post office and having the envelope stamped by hand at the counter. It’s also recommended to mail things by Certified or Registered mail, so you have proof of the mailing. 

As I write this, the January 31 deadline is looming for filing Form 1099-NEC with the IRS. Avoid the postmark situation by simply e-filing your forms (and, if you have 10 or more information forms overall, you must e-file them anyway).

A few more places where this could come up in the information world is with responses to IRS penalty notices (and on timelines regarding mailing of B-Notices, where, especially with B-Notices, there is no option for anything other than snail-mail. 

This new rule went into effect on Christmas Eve.