Yes, payee statements can be furnished to participating payees electronically. This is permissible with the prior consent of the participating payee. The consent must be made electronically in a way that demonstrates the recipient can access the statement in the electronic format in which it will be furnished. This is outlined in Treasury Regulation § 1.6050W-2, which provides detailed instructions for receiving consent from participating payees.
The regulation specifies that the recipient must affirmatively consent to receive the statement electronically, and this consent can be made electronically or in a paper document if it is confirmed electronically. The consent must be kept available for inspection by the IRS. Additionally, the regulation requires that the electronic version of the statement must contain all required information and comply with applicable revenue procedures relating to substitute statements to recipients.
Furthermore, the regulation mandates that if the statement is furnished on a website, the furnisher must notify the recipient that the statement is posted on the website, providing instructions on how to access and print the statement. The notice must include the statement "IMPORTANT TAX RETURN DOCUMENT AVAILABLE" in capital letters.
In summary, electronic furnishing of payee statements is allowed under the condition that the payee consents to it and the furnisher complies with the specific requirements set forth in the regulations.
Sources:
Publication 1179 (10/2023)
Publication 1220 (9/2023)
§ 31.6051-1. Statements for employees.
FS-2023-6
§ 1.6050W-2. Electronic furnishing of information statements for payments made in settlement of payment card and third party network transactions.
FS-2024-3
