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October 2016

Requesting Transcripts on Accounts with Identity Theft Flags

During a recent conference call that included representatives from TSCPA’s Relations with IRS Committee, the local IRS stakeholder liaison addressed how to obtain a client’s account transcript when the taxpayer is a victim of identity theft.

In order to reduce additional breach opportunities and secure taxpayer information, the Transcript Delivery System (TDS) no longer generates transcripts to requestors when there is an identity theft indicator on the account. The tax professional will receive the message, “Please have your client contact the Identity Protection Specialized Unit (IPSU) at 800-908-4490.” The client will receive an alert that a transcript request was attempted along with instructions to contact the IPSU. Tax professionals with a Power of Attorney (POA) may contact the IPSU for a transcript once their client receives the TDS letter and proper authentication is completed. For periods where no fraudulent return was filed, the preparer can contact the Practitioner Priority Service (PPS) at 866-860-4259 and assistors can issue the transcript.

The IRS is currently working on program changes to allow access to transcripts through TDS for tax years without an identity theft indicator.


Reminder of New Filing Dates for Certain Information Returns

By Jim Smith, CPA-Dallas

Information form filings with the Social Security Administration (SSA) have a new due date. The 2016 Forms W-2, W-2AS, W-2CM, W-2GU, W-2VI, W-3 and W-3SS are all due Jan. 31, 2017, regardless of whether they are filed on paper or electronically. Extensions of time to file forms with the SSA are no longer automatic. One 30-day extension may be requested by filing Form 8809, Application for Extension of Time to File Information Returns. The form must include a detailed explanation of why additional time is needed and must be signed under penalties of perjury. The IRS has stated that extensions will only be granted if there are extraordinary circumstances or catastrophe. Extensions of time to file do not extend the time to provide W-2 forms to employees. This requires a separate extension that can only be requested by letter and is normally only granted for 15 days, unless a clear need is shown for a 30-day extension.  

Public Law 114-113, Division Q, Section 201 requires Forms 1099-MISC that report nonemployee compensation be filed no later than Jan. 31, 2017. Forms 1099-MISC that do not include nonemployee compensation and all other Forms 1099 are due Feb. 28, 2017, if filed on paper or March 31, 2017, if filed electronically. The due dates for providing the 1099s to payees remain unchanged. Extensions of time to file 1099s are granted automatically by filing Form 8809. Extensions of time to provide forms to payees can be requested by letter and may be granted for a maximum of 30 days.

A chart of the new due dates for the 2017 filing season may be found at the following AICPA link:

TSCPA Committee Issues Letter to IRS on FOIA Procedure Concerns

This week, TSCPA’s Federal Tax Policy Committee issued a letter to IRS Commissioner Koskinen raising concerns about transparency by the IRS Disclosure Office or field personnel in responding to requests for records under the Freedom of Information Act (FOIA). The committee’s experiences indicate some IRS revenue agents or officers may be improperly withholding taxpayer information outside the administrative files submitted to the FOIA Disclosure Office. Members have also experienced undue delays and what we believe to be improper requests for scope limitations of our requests. The letter recommends that the IRS review and modify its procedures to address these issues as well as a pattern of multiple response delays that do not align with the statutory timeframe or offer adequate timely remedies and may violate taxpayer rights.