Online Filing:

IRS Pushes for Paperless Filing

Filing tax returns electronically used to consist of a two-step process. First, your client submitted their tax return via the computer, and then he/she had to send the IRS a separate paper form with their signature on it. In an effort to make the electronic tax filing process completely paperless, the IRS has implemented two pilot programs this year that replace handwritten signatures on paper with electronic-enabled numbers that can be used an electronic 'signature.'?

The first program uses an electronic filer customer number (ECN) as an electronic signature on the return. In order to participate in the ECN program, the taxpayer must meet the following criteria:

  • Prepare his own return
  • Have no required paper attachments other than Form W-2, Wage and Tax Statement, Form W-2G, Certain Gambling Winnings and/or Form 1099-R, Distributions from Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc.
  • Enter an ECN into his computer

The second program involves 18,000 tax practioners. These practioners will give their clients a chance to choose a five-digit personal identification number (PIN) that will serve as the taxpayer's electronic signature and eliminate the need to mail in the paper signature form.

Participation in both of these programs is voluntary. Taxpayers who feel more comfortable with the paper signature forms may continue to send these to the IRS instead of using PIN or ECN codes.