IRS Expands Paid Leave Credit, Retires FIRE System, and Adds New Tax Compliance Tool

The IRS issued its September 2026 small business e-newsletter on September 8 with five updates that touch day-to-day compliance: a permanently expanded paid family and medical leave credit, a hard deadline to stop using the FIRE e-filing system, a new authenticated tax compliance tool, disaster relief for Nebraska and Washington, and a reminder about online account services.

Paid Family and Medical Leave Credit Is Now Permanent

Treasury and the IRS released new guidance on the federal tax credit for paid family and medical leave under the Working Families Tax Cuts. Three changes affect small business owners directly:

The credit is now permanent.
Eligibility is broader. Employers with part-time workers are now covered, and the qualifying employee threshold drops to six months of service.
Insurance premiums paid during leave now count toward the credit, not just wages.

The guidance encourages businesses to offer up to 12 weeks of paid family and medical leave and gives employers clearer rules for claiming the enhanced credit. If your business already offers paid leave, or if you’ve been on the fence about it, the permanence of the credit and the insurance premium option change the math. Talk to your tax advisor about whether your current leave policy qualifies and what documentation you’ll need to claim it.

FIRE Is Going Away. IRIS Is the Replacement. The Switch Is Required Before 2027.

If your business files 1099s or other information returns electronically, this is the most time-sensitive item in the bulletin. The IRS is retiring the Filing Information Returns Electronically (FIRE) system after the 2026 filing season. Starting with the 2027 filing season, the Information Return Intake System (IRIS) will be the only IRS system for electronic information return filing.

IRIS is free and web-based. It doesn’t require special software, and it’s available to businesses of any size. But switching means updating your workflow, and the IRS’s language is unambiguous: “Users must switch to IRIS for the 2027 filing season.” Waiting until January 2027 is too late.

If your bookkeeper or payroll service handles information return filing, confirm now which system they’re using and whether they have a plan to move to IRIS before the 2026 filing season closes.

New Digitally Authenticated Tax Compliance Report

The IRS now offers a digitally authenticated Tax Compliance Report through Business Tax Account on IRS.gov. Business taxpayers can download the report on demand and share it with lenders, partners, or other third parties who need to verify federal tax compliance. Each report includes an IRS-issued digital certificate that confirms its authenticity, and verification features are embedded in the downloadable file.

This is a practical tool if you’re applying for a business loan, bidding on a government contract, or entering a joint venture where the other party wants to see your tax standing. It’s more secure than a paper transcript and easier to share. Access it through your Business Tax Account on IRS.gov.

Disaster Tax Relief: Nebraska and Washington

Businesses and individuals affected by several wildfire and storm events in Nebraska and Washington now have until February 1, 2027 to file various federal tax returns and make tax payments. The covered events are:

Wildfires in Washington and Douglas County, Washington, beginning July 31, 2026
Wildfires in Nebraska beginning June 9, 2026
Wildfires in Nebraska beginning May 16, 2026
Severe storms in Nebraska beginning May 15, 2026
The Pressey Fire in central Nebraska, beginning April 22, 2026
Wildfires in Nebraska beginning March 12, 2026

The IRS automatically identifies taxpayers located in covered disaster areas and applies relief. If your business is outside a covered area but was still affected, call the IRS Special Services line at 866-562-5227 to request relief.

Business Tax Account and Online Services

The IRS also used the bulletin to remind business taxpayers that Business Tax Account on IRS.gov lets you view balances, make payments, access tax records, authorize users, and manage certain tax obligations. The new Tax Compliance Report lives here too. Individual taxpayers have the Individual Online Account; tax professionals use Tax Pro Account.

One security note the IRS highlighted: only use IRS.gov directly. Don’t use third-party sites or links that claim to provide IRS account access. That’s how credential theft happens.

The Bottom Line for Your Business

The IRIS deadline is the most action-required item here. If you’re in Nebraska or Washington and affected by a listed disaster, check whether you’re in a covered area before your next return or payment is due. The PFML credit expansion is worth reviewing with your tax advisor if you offer paid leave or are weighing whether to start. And the Tax Compliance Report is a useful tool to know about before you need it.

BCA works with owner-operators and compliance-focused businesses on tax planning, information return obligations, and credits like the expanded PFML credit. If any of these updates raises a question about your situation, reach out.

This article is for general educational purposes only and does not constitute tax, legal, or financial advice. Tax rules are subject to change and individual circumstances vary. Consult a qualified tax advisor for guidance specific to your situation.

Educational information only, not licensed legal, tax, or financial advice. We refer to and partner with licensed professionals when personalized advice is needed. Laws change; no warranty of accuracy or timeliness.

Sources

IRS e-News for Small Business, Issue 2026-19, September 8, 2026: https://content.govdelivery.com/accounts/USIRS/bulletins/42872a0