Compliance
Compliance Essentials: Navigating New Reporting, Penalties & Thresholds in OBBB for Businesses
With the One, Big, Beautiful Bill introducing many new reporting requirements and penalties, staying compliant requires businesses and individuals to understand thresholds and transition relief.
By NomadicTax Research Team • 5-8 min read • November 17, 2025
## Key Compliance Changes Under OBBB You Need to Know
The One, Big, Beautiful Bill Act (OBBB) doesn’t just change deductions and credits—it overhauls **reporting thresholds**, **penalty structures**, and **information returns**. Missed deadlines or errors can lead to penalties. ([irs.gov](https://www.irs.gov/newsroom/irs-issues-faqs-on-form-1099-k-threshold-under-the-one-big-beautiful-bill-dollar-limit-reverts-to-20000?utm_source=openai))
### New or Reinstated Reporting Requirements
- **Form 1099-K Threshold Returns to $20,000 & 200 Transactions**: Retroactively reinstated pre-ARPA levels under OBBB. Third-party settlement organizations must file using this threshold. ([irs.gov](https://www.irs.gov/newsroom/irs-issues-faqs-on-form-1099-k-threshold-under-the-one-big-beautiful-bill-dollar-limit-reverts-to-20000?utm_source=openai))
- **Reporting of “No Tax on Tips” & Overtime Compensation**: New requirement to furnish statements showing tip amounts and occupation, overtime amounts, etc. ([irs.gov](https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions?utm_source=openai))
- **Car Loan Interest Reporting**: Businesses must report interest received on vehicle loans under certain criteria; transitional relief for 2025 for lenders. ([irs.gov](https://www.irs.gov/irb/2025-45_IRB?utm_source=openai))
### Penalties & Transition Relief
- **Deposits for Remittance Transfer Tax**: Effective January 1, 2026, providers must collect a 1% excise tax on certain remittances and deposit semimonthly. The IRS offers relief from Section 6656 penalties for mistimed or mis-calculated deposits in the first three quarters of 2026, provided conditions are met. ([irs.gov](https://www.irs.gov/newsroom/treasury-irs-provide-penalty-relief-for-remittance-transfer-providers-who-fail-to-deposit-excise-tax-under-the-one-big-beautiful-bill?utm_source=openai))
- **Safe Harbor Rules**: During those quarters, the usual safe harbor rules apply even if deposit amounts were incorrect, so long as reasonable cause is established. ([irs.gov](https://www.irs.gov/newsroom/treasury-irs-provide-penalty-relief-for-remittance-transfer-providers-who-fail-to-deposit-excise-tax-under-the-one-big-beautiful-bill?utm_source=openai))
### Practical Steps for Businesses & Individuals
- Review your contractor and vendor payment practices to identify whether you must file a 1099-K with the reinstated threshold.
- Establish processes to collect and report tip, overtime, and car loan interest information. Coordinate with payroll providers or lenders to ensure accurate reporting.
- For remittance transfer providers: set up systems for timely semimonthly deposits and understand when to assert reasonable cause to avoid penalties.
- Keep records of gross payments, number of transactions, tip amounts per occupation, and loan details; documentation is key under audit.
## Compliance Timeline & Deadlines
| Date | What Happens |
|---|---|
| Jan 1, 2026 | Remittance transfer tax begins; first semimonthly deposit due Jan 29, 2026. ([irs.gov](https://www.irs.gov/irb/2025-45_IRB?utm_source=openai))|
| 2025 | Transitional relief for reporting car loan interest. Tip/overtime reporting rules coming into effect. ([irs.gov](https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions?utm_source=openai))|
| Throughout first 3 quarters of 2026 | Relief from deposit penalties if reasonable cause and full payment by Form 720 due dates. ([irs.gov](https://www.irs.gov/irb/2025-45_IRB?utm_source=openai))|
## Example
*Jordan Inc.*, a remittance transfer provider, expects new obligations from Jan 1, 2026. In Q1, Jordan misses a deposit deadline and miscalculates the amount. Under Notice 2025-55, they may avoid the late deposit penalty if they 1) made a timely deposit (even if wrong), and 2) pay the underpayment by the Form 720 deadline. If Jordan documents the error and shows reasonable cause, compliance risk is minimized. ([irs.gov](https://www.irs.gov/newsroom/treasury-irs-provide-penalty-relief-for-remittance-transfer-providers-who-fail-to-deposit-excise-tax-under-the-one-big-beautiful-bill?utm_source=openai))
## Takeaway
Don’t wait to adapt—information gathering, system updates, and collaboration with your payroll, finance, or legal teams are essential. The grace period given by the IRS is helpful—but only if you understand and follow the rules carefully.