Release notes 25.05

Release Highlights

1099 Extensions now filed through IRIS not FIRE.
Change to reporting sale lots with market discount.
Alternate return mailing address for mail service packages.

New Features

The
Hold Asset For
field in the
Comprehensive Asset
register and custom register containing the field.

Fiduciary name and address change options in
Setup
Options & Overrides
Fiduciary Info
.

The State Overpayment Recovery collapsible section in
Tax Review Income
Other Income
.

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Beginning with tax year 2025, you will be responsible for preparing and filing the 1098/1099/5498 extension data files using IRIS. One exception is Form 1099-NEC whose extension requests must be submitted to IRS on paper.
Thomson Reuters will no longer file extension requests.
The process of clearing any validation errors and submitting extension data file to the IRS via IRIS is same as validating and submitting original and correction data files.
All 1098/1099/5498 payers as shown in
Setup
Information Reporting Setup
as well as Trust payers will be included in the extension data files. The Trust payers are created at the time of return processing therefore will only be included after associated returns are processed.
There's no separate extension form for each 1099 type. All 1099 form types and 1098 payer extension files are created by selecting the
1098 and 1099 Series
Form Type Selection.
5498
and
5498-ESA
have individual Form Type Selection boxes and will create separate files.
There's no Correction/Replacement filing process for extensions. If any payer’s extension file is rejected, the errors must be cleared, and the extension file re-prepared and re-submitted to IRS.
IRIS will begin accepting IRIS files in early January 2026 (after the IRS shutdown period). Only test files can be created in OTT during the shutdown period and can be used to identify any validation errors that exist in your data ahead of filing with IRS. Any existing errors can be reviewed using the
1099 Federal Pre-Filing Validation Errors
register. Test files (even those without validation errors) can't be submitted to IRS and therefore are only used for review purposes.

The
Extension Filings
Filing option was added under
Admin
Federal 1099 Data
Generate IRIS Filing Output
page to prepare the extension data files.
Once the
Extension Filings
option is selected, the Form Type Selection will display the applicable form types 1098 and 1099 series, 5498 and 5498-ESA to select for preparing data files.

Once prepared, the extension data files can be reviewed and submitted to IRS from
Review and Submit to IRIS
page.
The Form Type column will display
1099/1098, 5498, or 5498-ESA
based on the data file prepared and
Extension
will be shown in Filing Type column.
As with other data files,
Submit to IRIS
will be enabled only for non-test files that have a status of
Batch Completed
.

The
1099/1098/5498 Extension Filing Status
register was added to display the extension filing statuses for each payer. The 1099/1098/5498 payer information shown in the register can't be modified from the register.
The 1099 Extension Reports are created in XML format and will be available in
Admin
Federal 1099 Data
Review and Submit to IRIS
and
IRS filing Submission Status
pages. They won't be visible in
Documents and Data Files
1099-Data Files
as
Submitted
to IRS as in prior years.
The existing
1099 Pre-Filing Validation Errors
and
1099 Federal E-Filing Errors
registers will be modified in a later OTT release to include the pre-filing validation errors and transmission errors for extension filings.
Extension data files will be included in
Document Delivery
for those PANs set up to receive PAN level documents.

Upload in progress:
displayed while the file is being uploaded.
Antivirus scan in progress:
displayed while the PDF is checked for potential threats.

California requires a comment describing each return attachment.

Tax lots with market discount will no longer be grouped with tax lots without market discount.
Tax lots with market discount will be grouped with other lots that also have market discount, if they share the same term, either long-term or short-term.
Tax lots without market discount will be grouped with other lots that also do not have the market discount, if they share the same term, either long-term or short-term.

Two long-term lots have
Market Discount
values of
20.00
and
10.00
Their
Cost Basis
values are
175.46
and
196.08

These two lots will be combined into one sale because both have market discount and are long-term
The combined values will be:
Cost Basis:
175.49 + 196.69 =
372.18
Market Discount:
20.00 + 10.00 =
30.00

The
Cost Basis
and
Market Discount
of short-term lots with market discount will also be summed when grouped.
Short-term lots without market discount will be combined into a separate group.

The Parachute column was renamed Parachute (2024 and Prior) on 1099-MISC registers.
The NonEmplyee Comp (2019 and prior) column was removed from 1099-MISC registers.
The Parachute (2025 and forward) column was added to 1099-NEC registers.

Trustee to Trustee
QTP to Roth IRA

The description for tax code 257 was updated from
1099-R Death (4) to charity under IRC section 408(d)(8)
to
1099-R Death distribution to charity under IRC section 408(d)(8) - Y4
.
The description for Tax code 259 was updated from
1099R Normal Distribution (7) to charity under IRC Section 408(d) (8)
to
1099R Normal Distribution to charity under IRC Section 408(d) (8) - Y7
.

Tax code 257 description was changed from
1099R Death (4) to charity
to
1099R Death to Charity –Y4
.
Tax code 259 description was changed from
1099R Normal Distrib to Charit
to
1099R Normal Dist to CharityY7
.

Tax code 257 description was changed from
1099R Death (4) to charity under IRC sec 408(d)(8)
to
1099R Death to charity under IRC sec 408(d)(8)-Y4
.
Tax code 259 description was changed from
1099R-Normal Distrib to Charity-IRC Sec 408(d)(8)
to
1099R Normal Distr to Charity IRC Sec 408(d)(8)-Y7
.

1099-R Death distribution to charity under IRC section 408(d)(8) - Y4
1099R Normal Distribution to charity under IRC Section 408(d) (8) - Y7

Example 1: If the register displays 1099-DIV transmission errors and subsequent filing was accepted prior to 25.05 release, then those records will continue to display.
Example 2: If the register displays 1099-DIV transmission errors and subsequent filing was submitted and accepted after the 25.05 release, then the previous error related to the forms re-submitted will be removed from the register.
Example 3: If the register displays 1099-DIV transmission errors and subsequent filing was submitted after 25.05 release and is rejected/accepted with errors then the register will remove the previous errors and will display the latest errors provided by IRS.

If you have attained the age of 73 or older, you are required to take a minimum distribution (RMD) from your IRA account(s) no later than December 31 of each calendar year. If you reached 73 in 2025, you have until April 1, 2026 to take your first RMD. RMDs for all subsequent calendar years must be satisfied by December 31. We are required to report to the IRS that you are subject to RMD. Please contact your financial advisor if you require assistance in calculating the RMD for your IRA accounts held with us.

If you have attained the age of 73 or older, you are required to take a minimum distribution (RMD) from your IRA account(s) no later than December 31 of each calendar year. If you reached 73 in 2025, you have until April 1, 2026 to take your first RMD. RMDs for all subsequent calendar years must be satisfied by December 31. We are required to report to the IRS that you are subject to RMD. Please contact your financial advisor if you require assistance in calculating the RMD for your IRA accounts held with us.

Beginning with tax year 2025, the
Q1. Etc. Revising Reporting for Specific Recipient
checkbox was added to
1042-S Income Overrides
and
1042-S Additional Income
grids under 1042-S Recipient Information.

The
United States of America
country was added to the
Country code for Tax Purposes
dropdown under 1042-S Recipient Information.

The
Excepted Specified Foreign Financial Assets are Reported on this Form
checkbox was added.
The
Excepted Specified Foreign Financial Assets are Reported on this Form
checkbox was updated to
Qualifying Insurance Corporation Election I
.

Net section 1062 tax liability due this year, from Form 1062
Amount from Form 4255, Part I, line 3, column (q)
Amount from Form 4255, Part I, line 3, column (r)
Net tax liability deferred on sale of farmland (Form 1062)

To use the alternate address, set the
Use Alternate Return Address for Mail Service
to
YES
(the default set to
No
).
Enter the alternate mailing address in the following fields:
Name
Name (cont.)
Address
City
State
ZIP
note
The
ZIP
field is on page 2 of the options if the options are filtered to the
Fiduciary Info
category.

Options that weren't applicable to tax years after 2020 were removed.
The (
Option applicable beginning with 2020 tax year)
reference was removed from the following options under Fiduciary Info category:
First name of officer signing the return (990 Only) (Option applicable beginning with 2020 tax year).
Last name of officer signing the return (990 Only) (Option applicable beginning with 2020 tax year).
SSN of officer signing the return (990 Only) (Option applicable beginning with 2020 tax year).
The (
Option applicable beginning with 2021 tax year)
reference was removed from the following options:
Print
category:
Print a statement of election to relinquish farm NOL carrybacks arising in tax years after 2020 (Option applicable beginning with 2021 tax year).
Compute - Federal
category:
Method of distributing credit for employer-provided childcare facilities and services (Option applicable beginning with tax year 2021).
Beneficiary
category:
Suppress print of the Asset Holdings footnote (option applicable beginning with tax year 2021).
Enhanced 1099
category:
Suppress print of the Asset Holdings footnote (option applicable beginning with tax year 2021).
Electronic Filing
category:
Consider 5227 returns for electronic filing qualification (Option applicable beginning with 2021 tax year).
Consider 5227 situs state returns for electronic filing qualification (Refer to Customer Center for the complete list of available states) (Option applicable beginning with 2021 tax year).
Consider 5227 non-situs state returns for electronic filing qualification (Refer to Customer Center for the complete list of available states) (Option applicable beginning with 2021 tax year).
Consider 990 situs state returns for electronic filing qualification (Refer to Customer Center for the complete list of available states) (Option applicable beginning with 2021 tax year).
Consider 990 non-situs state returns for electronic filing qualification (Refer to Customer Center for the complete list of available states) (Option applicable beginning with 2021 tax year).
The (
Option applicable beginning in tax year 2021)
reference was removed from the following option under
Compute – States
category:
Do not consider IRC 663(b) distributions made within 65 days of the close of the prior taxable year.
The
(beginning Tax year 2021)
reference was removed from the following option under
Electronic Filing
category:
Settlement date for 990 state balance due payments [Date entered must have a four character year, i.e., MM-DD-YYYY]
The
for 2020 TY and forward
reference was removed
from the following option under
Compute – States
category:
Fiduciary has verified the names, addresses, TINs, and bank information (Applies to GA)

Room or suite no.
(Option applicable beginning with tax year 2025).
Foreign Postal Code
(if applicable) (Option applicable beginning with tax year 2025).
Foreign Province
(if applicable) (Option applicable beginning with tax year 2025).
Foreign Country
(if applicable) (Option applicable beginning with tax year 2025).

The Label was updated from
NEW HAMPSHIRE
to
NEW HAMPSHIRE (tax years 2024 and before)
Option
Computation of beneficiary message for non New Hampshire situs, non-final, simple/complex trusts
was updated to
Computation of beneficiary message for non New Hampshire situs, non-final, simple/complex trusts (option not applicable beginning with 2025 tax year)
.
Option
Treat short-term capital gain dividends as non-taxable income
was updated to
Treat short-term capital gain dividends as non-taxable income (option not applicable beginning with 2025 tax year)
.

The federal return is attached as a pdf under E-Filing Document Upload because the federal return can't be e-filed (requires reprocessing)
checkbox was removed for all tax years.
Beginning in tax year 2025, the following fields were removed:
California Secretary of State File Number
Limited Liability Company Temporary Identification Number assigned by FTB

Form 1299-B - River Edge Dividend Subtraction from K-1-P or K-1-T
Form 1299-B - High Impact Business within a Foreign Trade Zone Dividend Subtraction from K-1-P or K-1-T

Does the grantor have a reversionary interest in any portion of the corpus of the trust or the trust income?
Does the grantor have the power to remove an independent trustee and substitute any person, including themselves, as trustee?
Has the grantor directly or indirectly borrowed from the corpus or income of the trust?
Does the grantor or a non-adverse party have the power to purchase, exchange, or otherwise deal with or dispose of the trust corpus or income?

Fixes

Known Issues

ONESOURCE Trust Tax Insight 25.05 Release Notes