The American Institute of Certified Public Accountants (AICPA) will urge the IRS to delay, by at least a year, implementation of mandatory electronic filing (e-file) procedures for large corporations and exempt organizations at a hearing before the IRS this week. Deborah J. Pflieger, former chair of the AICPA’s Practice and Procedure Committee and a Managing Director in PricewaterhouseCoopers, LLP’s Washington, D.C. National Tax Office, will represent the AICPA at the IRS hearing on Wednesday, March 16, 2005, regarding the mandatory e-file procedures.
“We view this as a dramatic change, with inadequate lead time,” Pflieger said. “We support the IRS’s long-range goals for electronic tax administration, but think the change is too sudden.
“The affected corporations and tax exempt organizations, software developers and tax practitioners will have to make significant process and technology changes in order to comply with mandatory e-filing requirements,” Pflieger said. “The changes require substantial collaboration and coordination by the IRS with all impacted parties, but the taxpayers and tax practitioners who prepare and file the majority of affected returns have not been provided ample opportunity to share their corporate e-file issues.”
The IRS’s recently released regulations will generally require corporations with total assets of $50 million or more and tax-exempt organizations with total assets of $100 million or more to e-file their tax returns to the IRS starting in January 2006.
In addition, smaller corporations and exempt organizations face an e-filing requirement starting in January 2007 under the regulations.
Beginning in January 2007, corporations and exempt organizations with total assets of $10 million or more and all private foundations and charitable trusts, regardless of asset size, will generally be required to electronically file tax returns.
The IRS regulations are available online.