Tax reporting is under greater scrutiny as the IRS strengthens its ability to match data across filings, identify inconsistencies, and respond faster.
At the 2026 Tax Reporting and Withholding Conference in Arlington, Virginia., a clear message emerged: small reporting gaps now create outsized risk. Mismatches, incomplete documentation, and inconsistent data are driving more IRS inquiries and audits.
Tax reporting has always been a year-round discipline, even if it has not received the attention it deserves. As a result, maintaining accurate data, strong controls, and coordination across the business year-round is more critical than ever.
CBIZ helps private equity firms streamline Global Information Reporting (GIR) compliance across the fund lifecycle, strengthen reporting processes, close documentation gaps, and reduce compliance risk before issues escalate.
Here are the key trends shaping risk and what they mean for your organization.
IRS Scrutiny is Rising Across Key Filings
The IRS is taking a closer look at how information reporting ties together, and Form 1042 and Form 1042-S are a key focus.
A major theme at the conference was the IRS focus on mismatches between Forms 1042 and 1042-S. When totals do not align, discrepancies are easier to spot and more likely to trigger follow-up.
The IRS is also comparing these forms with investor-level reporting, including Schedule K-1s, to test accuracy and completeness across filings.
Many organizations are already receiving soft letters requesting explanations for discrepancies, and unresolved issues can escalate into audits.
Documentation Gaps Continue to Drive Risk
Gaps in documentation remain a leading source of audit exposure and continue to surface in IRS reviews.
Conference speakers emphasized that weak documentation practices create problems that are difficult to fix later. Incomplete, outdated, or inconsistent Forms W-8 and W-9 can directly affect withholding and reporting.
IRS audits often focus on how organizations collect, validate, and support the information reported across filings.
The challenge is not only collecting forms but maintaining accurate information over time as circumstances change and documents expire.
A draft Form W-9 released in June 2026 reinforces this focus by signaling continued IRS attention on accurate payee information and classification.
What the Draft Form W-9 Means Right Now
The latest draft of Form W-9 is more than a routine update. It signals where the IRS is placing greater focus in the reporting process.
Released in 2026, the draft highlights greater attention on payee identification, classification, and data quality at the point of collection. Even before the final version is issued, the direction is clear: the IRS wants more accurate information before reporting begins.
Because Form W-9 affects how payees are classified and reported, even minor inconsistencies can create questions during review.
The Shift to IRIS is Changing how Teams Operate
The move from FIRE (Filing Information Returns Electronically) to IRIS (Information Returns Intake System) is not just a system update. It is changing how tax reporting gets done.
IRIS introduces structured data, real-time validation, and immediate feedback, allowing teams to identify errors during submission instead of after filing.
It also creates operational complexity. Large filings may need to be split into multiple submissions, each with its own response to review and reconcile.
For global organizations, the challenge increases because not all states and jurisdictions are fully aligned with IRIS, forcing teams to manage multiple filing approaches.
Because IRIS depends on structured, complete data, source data issues are exposed quickly and must be resolved promptly.
A New Compliance Reality Is Taking Shape
Greater IRS scrutiny, evolving documentation expectations, and the move to IRIS are all raising the standard for how reporting is executed and supported.
The common thread is visibility. Regulators can compare information across filings, systems, and stakeholders more easily than before. As a result, organizations need stronger alignment across data, processes, and reporting to keep pace.
Stay Ahead of Shifting Tax Reporting Requirements
Greater scrutiny and evolving reporting standards are increasing pressure across the fund lifecycle. CBIZ helps private equity firms strengthen Global Information Reporting (GIR) compliance, improve reporting processes, and close documentation gaps before issues escalate.
Connect with a CBIZ advisor to strengthen your reporting, documentation, and compliance processes.
Frequently Asked Questions
A change in circumstances is any event that makes information on an existing Form W-8 incorrect. In practice, that can include a change to Name and address residency, entity classification, or treaty eligibility. When that happens, the form may no longer be valid for withholding and reporting purposes, so the documentation should be reviewed and updated promptly.
In general, a Form W-8 remains valid for the year it is signed and the next three full calendar years, unless a change in circumstances makes the form incorrect earlier. Because validity can vary depending on the form and facts involved, organizations should track both expiration timing and any events that could require updated documentation before that period ends.
The draft 2026 Form W‑9 includes updates focused on improving reporting accuracy and addressing new digital asset requirements.
Key changes:
- Digital asset reporting updates: Adds a checkbox and new exempt payee code (Code 14) for certain digital asset brokers in connection with Form 1099‑DA reporting.
- TIN reporting clarifications: Reinforces that sole proprietors should generally use an SSN (or ITIN), and disregarded entities must report the owner’s TIN.
- Instruction updates: Reflect broader reporting changes, including higher thresholds for certain information reporting and backup withholding.
These updates are designed to reduce TIN mismatches, improve compliance, and align the form with evolving reporting requirements, particularly for digital assets.
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