Tax return preparers must e-file for 2010 tax returns
Posted by AccountingWEB in Tax, Income Tax on 12/21/2009 - 12:50
Tax return preparers will have to pay attention to an amendment added in the Senate version of the Worker, Homeownership, and Business Assistance Act of 2009, which extended the First Time Homeowner Credit and unemployment benefits, because beginning in 2010, this amendment will require tax return preparers to file any individual tax return electronically unless the preparer expects to file fewer than 10 returns in a calendar year. This means that individual tax return preparers will be required to apply for an EFIN, the Electronic Filing Identification Number, which will help the Internal Revenue Service (IRS) to track their returns. The requirement applies to individual tax returns, estate, and trust returns. Note: This new law does not affect 2009 tax returns filed in 2010.
Other amendments tacked on to the bill by the Senate:
· Extend the 0.2‐percent Federal Unemployment Tax Act (FUTA) surtax through June 30, 2011 to pay for the extension of unemployment insurance benefits
· Increase penalties for failure to file Partnership or S Corporation returns from $89 to $195 per month per partner or shareholder effective December 31, 2009. The penalty may also be imposed for incomplete returns of Schedules K-1.
- Increase the required estimated tax due from corporations with assets of at least $1 billion due in July, August or September 2014 by 33 percentage points, to 133.25 percent of the payment otherwise due for the quarter. The payment due in the following quarter is reduced by a corresponding amount.
Reports of widespread fraud and abuse in the preparation of tax returns, particularly in regard to the Earned Income Credit and the First-time Homebuyer's Credit, prompted the IRS to prepare a set of recommendations for Congress and the President to address this fraud. The final IRS recommendations for registration of tax return preparers will be made public in early January, according to the American Institute of Certified Public Accountants (AICPA).
In a video presentation on their web site, Barry Melancon, AICPA president, and Alan Einhorn, chairman of the AICPA's Tax Executive Committee, review what has happened so far in the discussion of tax preparer fraud prevention, and emphasize that the AICPA supports "a reasonable solution," but express concern about possible damage to the CPA credential. One part of a "reasonable solution" is a single preparer indentifying number and making all preparers subject to existing penalties under Circular 230, but Melancon and Einhorn expressed concern about other kinds of registration and testing. If Congress votes to create a new certification and exam, Melancon says, "The process would go too far."
The original version of the Act also permits all businesses, regardless of their gross receipts, to carry back net operating losses incurred in 2009 for up to five years (with a 50 percent income limit in the fifth year).
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Gail Perry, CPA
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I was unaware of the fact that now amendment will require tax return preparers to file any individual tax return electronically unless the preparer expects to file fewer than 10 returns in a calendar year. Your post has updated me well.
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Thanks for sharing it
Thanks for sharing it.!I also think that this is the best way to deliver the news on a particular topic, I would say that thanks a lot for sharing this content.
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great
After fire,my father died and had to help my mom. I've done tax prep for 42yrs--it's only way I can make a living. Medical expenses are huge.
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appears as preparer
As we were told in the update seminars, If your name appears as preparer then you are the "filer" for purpose of meeting the e-file requrement.
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E-FILING REQUIREMENTS
Has anyone actually seen what these requirements mean? Some people say all the returns must be e-filed. Some say at least 1 of the prepared returns must be e-filed. Some say any returns the client mails in is OK to not be e-filed.
I have e-filed some of my returns for years, but I have clients who don't want to do that.
So- Do all of the returns I prepare have to be e-filed? If someone has a link to a definite answer, please let me know.
BTW - I called the IRS about this a few week ago & at that time they couldn't give an answer other then they will be providing answers soon.
hardship exception to taxprepare efile requirement
I have been physically handicapped,in constant pain,and had use of only 1 hand since 1957,junior high. But I've always supported myself and family doing tax prep at home. I'm also a senior citizen. My wife has Lupus,fibromyalgia,asthma,& rheumatism & cannot help me. Both my sons are mentally ill. In March 2006,my sons burned down our house,including my office. We lost everything. Nothing will ever be the same. After fire,my father died and had to help my mom. I've done tax prep for 42yrs--it's only way I can make a living. Medical expenses are huge.
To do efiling would completely altar the way I serve taxpayers,who have been comfortable with the way I do business for years. It would add a lot of expense that I can't afford and,if I pass the cost on to the taxpayers,I could lose clients,as many of them are having difficult times now,too.
The older I get,the harder it is to push through the constant pain and overcome handicaps. PLEASE grant me a hardship exemption from efiling. Thank you for being kind--Arthur E Arden (PTIN 00116855),7314 Charlotte St,Springfield VA 22150-4011 phone 703-644-2590 fax703-644-2655 arthurarden@yahoo.com. Please contact me.
e-security?
This seems like a great idea, in the theory of reducing paper use and streamlining the submitting process. The only thing I'm worried about is the security of online transactions of tax information. It seems like any iaq source could possibly be accessed, although I would personally trust the IRS in their security settings.
efiling requirement for 1041s
I keep hoping that there is some type of exception for efiling trust returns. I file 100+ individual returns electronically--100% of the returns that are allowed to be efiled. But, I usually prepare 1 to 2 --1041 forms each year. Is there any hope that the 10 return requirement is per return type? Or am I going to have to efile my 1 to 2 1041s because of my 1040 business? This would be costly for me because I could not even recoup the cost of the tax software that would allow efiling through a 3rd party. Is anyone aware of an exception? Can anyone help me with ideas of how I could cost effectively file the 1-2 trust returns? Thanks.
-- Taxed1
the exam
If Congress votes to create a new certification and exam,???
i like the the new exam,the harder exam ,the more title you can get ,and the more money you can get!
About...
I second the opinion.
Jay' posting
Jay, that's just semantics. If you prepared and signed it, it must go electronically.
BTW, is there any provision for client opt-out? I know there is in NY.
E-file rules
As we were told in the update seminars, If your name appears as preparer then you are the "filer" for purpose of meeting the e-file requrement. I did not lend it a lot of importance because we e-file everything that we can.
New tax law
I believe that the new law applies to preparers who file more than 10 returns. If I prepare a paper return and the client sings and mails it, the client is filing the return, not me.
Jay D. Hillis
EA, ATA,ABA
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