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NYA Stakeholder Liaison Field IMRS Monthly Discussion Call Summary March 15, 2017

Topics Discussed:

IMRS Local Issue Database(LID) Issue

DirectPay payments should be reflected on tax account transcripts but do
not appear to be. For 2015 and 2016, a taxpayer paid estimated tax
payments through DirectPay but these payments did not show on tax
account transcripts. His accountant called the Practitioner Priority Line and
was able to verify that the estimated payments posted and, in each case,
the return was processed without incident.

IRS Took Down FAFSA-Autofill Tool to Prevent Identity Theft
An online tool that auto-filled tax data for federal student loan applications
has been temporarily removed in an effort to stave off identity thieves.
The Internal Revenue Service is suspending the “Data Retrieval” feature
on its online Free Application for Federal Student Aid, meaning applicants
will need to copy their financial information from tax returns or from the
software they use to file their taxes, according to the IRS. The same tool
was used for the income-driven repayment application process.
The tool could be down for several weeks, according to an IRS
announcement. The agency said it’s trying to fix the problem “as quickly as
possible.”

The suspension of the Data Retrieval Tool was a precaution “following
concerns that information from the tool could potentially be misused by
identity thieves.”

The IRS and Federal Student Aid together are investigating those risks,
and also collaborating on a way to make the DRT more secure from
potential thieves. The IRS announcement called the problem “relatively
isolated” and noted “no additional action is needed by taxpayers or people
using these applications.”

IRS recommended applicants unable to get a copy of their tax returns
request a transcript through the IRS site, which requires them to verify
their identities.

The IRS has struggled with cybersecurity problems in the past; the
Government Accountability Office has repeatedly pointed out glaring
security flaws in the agency’s cyber protocol, including that employee
passwords weren’t secure enough and that user passwords often didn’t
expire at regular intervals, potentially putting taxpayer information at risk.
Availability of 2016 wage & income transcripts

With the new earlier due date for W-2 and 1099-misc with non-employee
compensation being January 31 some practitioners have questioned when
will we begin to see data on the 2016 wage & income transcripts?
IRS Says-TY 2016 data should be accessible online by Wednesday,
February 1, 2017.

UPDATE: E-Service Accounts that are now suspended:

On Friday, March 10th, the IRS announced in e-News for Tax Professionals
that extra assistance would be available for Letter 5903 recipients who
must revalidate their identities. However, a major snow storm for the East
Coast hit our Andover, Mass Call Site on Tuesday, March 14th. As a result,
we did not have the additional assistors on staff last week to assist Letter
5903 recipients. We have rescheduled:
Additional Staff Available Starting Tuesday
March 21 to Revalidate

Your Identity

If you received a Letter 5903, e-Services Revalidation, you must revalidate
your identity. For a limited time, the e-Services Help Desk will have
additional staff available to only assist tax professionals who need to
revalidate their identity to have their e-Services registration account
reinstated.

Additional assistors will be in place Tuesday, March 21 through Friday,
March 24.

E-Services registration accounts were suspended for tax professionals who
received Letter 5903 and failed to revalidate their identities within the
required 30-day time period. The IRS urges tax professionals who need to
revalidate their identity to do so now when extra staff is on hand and not
wait until there is an emergency need to access their e-Services accounts.
Letter recipients must revalidate even if they are infrequent users of eServices
or its tools. As a reminder Authorized IRS e-file Providers must
ensure the IRS has current information by reviewing and updating their IRS
e-file application within thirty days of a change which requires access to
your e-Services registration account. Letter 5903 was issued to those tax
professionals who have access to sensitive taxpayer data through e-
Services and who have accessed their accounts in the past year. This is
part of the IRS’ ongoing effort to strengthen security around certain selfhelp
tools on IRS.gov and better protect taxpayer and tax professional
data.

More information is available at www.irs.gov/eservices.

W-2 verification Code Update

As part of the new identity verification information, the IRS and has worked
with payroll processors to add the new security-related field to some W-2s.
The new field is a code designed to help verify the authenticity of the W-2
data being reported by the recipient.

The code will be a 16-digit value containing the letters “A” through “F” and
numbers “0” through “9”. For some received W-2’s this new code will
appear in box 9. For other received W-2’s, the code will appear within the
Recipient’s Name area of the printed form.

There has been some confusion when inputting the codes whether the
code contained a zero or letter O. Since the letter O is not an option, please
note that a zero (0) should be entered.

Update on Previously Discussed Issue:

Clarification on making an electronic payment and getting an
automatic extension of time to file
An extension of time to file will automatically process when you pay all or
part of your taxes electronically by April 18. There’s no need to file a paper
or electronic Form 4868, Application for Automatic Extension of Time to
File U.S. Individual Income Tax Return. However, an extension of time to
file is not an extension to pay. You can file up to six months later when you
have an extension, but your taxes are still due by your original due date.
You can get an automatic extension when you make a payment with Direct
Pay, the Electronic Federal Tax Payment System or by debit or credit card.
When paying electronically, you must select Form 4868 as the
payment type and the payment date in order to get the automatic
extension. Keep the confirmation you receive as proof of your
payment.

New Issues

New Security Summit Preparer Physical Address on Returns
Requirement?

At least one tax software company has told the practitioner that the IRS
Security Summit issued a requirement that return preparers must print on
all returns and mailings to clients a physical street address and not a Post
Office box address. For example, a preparer’s address is printed at the
bottom of page 2 of the 1040 and similar returns, and as return address on
returns mailed to clients. Did the Security Summit/IRS issue such
regulations and can we as preparers get copies of them?

A physical address must be provided on the EFIN registration and that
address must correspond to the physical location of the computer
transmitting e-filed returns. But the practitioner have found nothing in the
e-file publications that takes that further to say the preparer must print that
physical address on returns and mailings to clients.

If so, that is inconsistent with the regulations for EA’s who’s license may be
issued to their home address but the EA’s may list a separate business
address, including a Post Office box, as the address disclosed to the public
and vendors for directory publication and marketing purposes.
This Issue was added to the IMRS Discussion Board SharePoint site.

2017 IMRS Monthly Discussion Call Schedule

NYA IMRS Monthly Discussion Calls will be held on the Third Wednesday
of the month. Please note that to accommodate the holiday season the
December 2017 meeting will be held on December 13th.
Schedule for remainder of year:
NYA IMRS Discussion Calls will be held on the third Wednesday of the
month.