The Internal Revenue Service continues to go more digital, at least temporarily to make filings easier as we continue to deal with the effects of the coronavirus pandemic.
Late last month, the IRS announced 10 forms that previously had to be signed in ink on their printed paper version. You can read about this first group of forms to be granted digital signature status in my Aug. 28 post.
On Sept. 10, the tax agency added another six forms to the digital signer list. They are:
- Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
- Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
- Form 709, U.S. Gift (and Generation-Skipping Transfer) Tax Return;
- Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons;
- Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts; and
- Form 3520-A, Annual Information Return of Foreign Trust With a U.S. Owner.
Those six additional docs that can be digitally signed also are this week's By the Numbers figure.
E-signatures available through year-end: All 16 forms — the 10 previously announced and this latest half-dozen — still cannot be electronically filed.
They still must be download at the IRS website or through tax professionals' software products. Once completed on the computer, the forms then are printed and snail mailed.
However, all of these U.S. Postal Service forms can be submitted with digital signatures if they are mailed by or on Dec. 31, 2020.
"Electronic and digital signatures appear in many forms when printed and may be created by many different technologies. No specific technology is required for this purpose during this temporary deviation," noted Sunita Lough, IRS Deputy Commissioner for Services and Enforcement, in her digitally signed memo to IRS staff about the additional forms.
Prompted by health concerns: As noted when the IRS initially made this short-term e-signature change, the process revision will help taxpayers and tax pros meet filing deadlines while maintaining COVID-19 personal distancing precautions.
With a digital signature option, taxpayers and their tax preparers can complete the eligible documents without face-to-face meetings just to physically sign the form.
More e-sigs on the horizon? The IRS also is again giving tax professionals, who are relying increasingly on electronic tax processes, some hope that such e-signatures could be more commonplace.
In announcing the six new e-signature forms for the 2020 tax year, the IRS noted that it "understands the importance of digital signatures to the tax community."
And while the IRS is only allowing digital signatures on these 16 forms temporarily, the agency said (again) that it "will continue to review its processes to determine where long-term actions can help reduce burden for the tax community, while at the same appropriately balancing that with critical security and protection against identity theft and fraud."
You also might find these items of interest:
- Digital IRS is costing those who can least afford it
- Form 1040-X now can be e-filed, but just (for now) to correct 2019 return mistakes
- New Taxpayer Advocate highlights COVID-19 effects on the IRS and taxpayers in her first report
|Coronavirus Caveat & More Information
In 2020, we're all dealing with extraordinary circumstances,
both in our daily lives and when it comes to our taxes.
The COVID-19 pandemic and efforts to reduce its transmission
and protect ourselves and our families means that,
for the most part, we're focusing on just getting through these trying days.
But life as we knew it before the coronavirus will return,
along with our mundane tax matters.
Here's hoping that happens soon!
In the meantime, you can find more on the virus and its effects on our taxes
by clicking Coronavirus (COVID-19) and Taxes.