Signing your tax return: IRS norms simplified

If you are a U.S. citizen, tax season has in all probability got you under the weather. And in these taxing times, if there is one thing that can take the heat off your e-filing process, it is electronic signatures.

As with an income tax return submitted to the IRS on paper, the taxpayer and paid preparer (if applicable) must sign an electronic income tax return. With the recent electronic signature guidance by IRS, e-filing has become completely electronic in the truest sense.  Under this new guidance, IRS has expanded the use of electronic signatures on two authorization forms for individual income tax returns.

If you are a taxpayer planning to file taxes by yourself or are planning to go the Electronic Returns Originator (ERO) route, you would need to know the e-signature norms as put out by IRS. In the following paragraphs, we have tried to simplify the various electronic signature methods available for signing your tax return. Hope it helps you get through this tax season faster than ever :)

Electronic signature methods to sign tax returns

1. Self-select PIN method: Self-Select PIN method requires taxpayers to provide their prior year Adjusted Gross Income (AGI) amount or prior year PIN for use by the IRS for authentication.

  • Do it yourself:  A completely paperless process, in this method, you can directly enter your PIN into the electronic return record using key strokes, after reviewing the completed return.  In case you don’t have the PIN or the AGI amount, then you can request for an Electronic Filing PIN on IRS.gov and start with e-filing your taxes.
  • E-sign and authorize your EROs:  You may also authorize EROs to enter PINs on your behalf, in which case you must review and sign a completed signature authorization form after reviewing the return. 

2. Practitioner PIN method: Practitioner PIN is the other method and it does not require the taxpayer to provide their prior year AGI amount or prior year PIN. When using this method, taxpayers must always appropriately sign a completed signature authorization form. Taxpayers, who use the Practitioner PIN method and enter their own PINs in the electronic return record using key-strokes after reviewing the completed return, must still appropriately sign the signature authorization form.

Signing form 8879 and 8878 for authorizing your ERO

The recent electronic signature guidance has brought under its scope, the use of electronic signatures on two authorization forms – Form 8878 and 8879 – for individual income tax returns. The new guidance reduces burden on taxpayers who had to physically sign the authorization form either in their ERO’s office or mail it. 

Details on the authorization forms:

  • Form 8879: This is IRS e-file signature authorization form, that authorizes an ERO to enter the taxpayers’ PINs on individual income tax returns.
  • Form 8878: This is IRS e-file authorization for application of extension of time to file, authorizes an ERO to enter the taxpayers’ PINs on Forms 4868 and 2350.

Note: Form 8878 is only required for Forms 4868 when taxpayers are authorizing an electronic funds withdrawal and want an ERO to enter their PINs.

You must sign and date the Form 8878 or Form 8879 after reviewing the return and ensuring that the tax return information on the form matches the information on the return. The taxpayer may return the completed Form 8878 or Form 8879 to the ERO by hand delivery, U.S. mail, private delivery service, fax, email or an Internet website.

Electronic signature types that can be used for Forms 8878 and 8879

According to IRS, electronic signature is a method of signing an electronic message that identifies and authenticates a particular person as the source of the electronic message and indicates such person’s approval of the information contained in the electronic message. Electronic signatures appear in many forms, and may be created by many different technologies.

List of currently acceptable electronic signature methods as per IRS:

  • A handwritten signature input onto an electronic signature pad
  • A handwritten signature, mark or command input on a display screen by means of a stylus device
  • A digitized image of a handwritten signature that is attached to an electronic record
  • A typed name (e.g., typed at the end of an electronic record or typed into a signature block on a website form by a signer)
  • A shared secret (e.g., a secret code, password or PIN) used by a person to sign the electronic record
  • A digital signature
  • A mark captured as a scalable graphic

Before you choose an electronic signature provider for signing tax returns

Did you know that software used for e-signature must capture certain specific data, as per IRS? Here is the list:

  • Digital image of the signed form
  • Date and time of the signature
  • Taxpayer’s computer IP address (Remote transaction only)
  • Taxpayer’s login identification – user name (Remote transaction only)
  • Identity verification: Taxpayer’s knowledge based authentication passed results and for in-person transactions, confirmation that government picture identification has been verified;
  • Method used to sign the record: Example, typed name; or a system log; or other audit trail that reflects the completion of the electronic signature process by the signer.

SignEasy is IRS compliant!

Sign your documents this tax season, using SignEasy here

If you are a taxpayer:  For e-signing Form 8879 or 8878 you need a legally binding electronic signature solution, like SignEasy. Using the SignEasy app on Android, iOS or from the Web,  you can get the forms signed and sent to your ERO within a matter of seconds.  

If you are an ERO: When your clients need to send you Form 8879 or 8878, redeem them from the hassle of pen and paper signature and couriering it to your postal address. Make the process of authorization, simple and fast by asking them to sign and e-mail it to you. All they need is the required form and SignEasy app.

So don’t look further.  April 18th is just around the corner. Complete e-filing of your taxes today, with SignEasy!

SIGN WITH SIGNEASY  

Disclaimer: Information provided on this page is for educational purpose and has been compiled from the IRS website.

 

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