THE TRANSATLANTIC MAGAZINE
The IRS has confirmed that from now until December 31, 2020, certain forms which traditionally need to be physically signed can now be submitted with an e-signature instead.
The move is designed to protect tax payers and tax professionals amidst the ongoing health uncertainty due to COVID-19, by reducing the amount of in person contact required to file forms. IRS Commissioner Chuck Rettig explained that "We take the health and safety of the nation's taxpayers, the tax professional community and our employees very seriously ... Expanding the use of digital signatures is an important step during COVID-19 to help tax professionals."
Rettig went on to say that "We understand the importance of digital signatures to the tax community, and we will continue to review our processes to determine where long-term actions can help reduce burden for the tax community, while appropriately balancing that with critical security and protection against identity theft and fraud."
According to the 2019 IRS Data Book only 34% of overseas Americans filed their tax returns electronically last year, with 66% choosing to file paper returns. Form 1040, for US Individual Income Tax Returns, already offers the option to use an e-signature when filing electronically. The IRS "recommends all taxpayers consider e-filing forms this year, whenever possible, because of COVID-19."
The forms which the IRS have announced can be signed with an e-signature will still need to be mailed, however the opportunity to sign with a digital signature as opposed to requiring in person meetings with your tax expert for a signature could be particularly useful for overseas Americans.
The forms which can now be mailed with an e-signature, provided they are mailed by or on December 31, 2020 include:
• Form 3115, Application for Change in Accounting Method;
• Form 8832, Entity Classification Election;
• Form 8802, Application for US Residency Certification;
• Form 1066, US Income Tax Return for Real Estate Mortgage Investment Conduit;
• Form 1120-RIC, US Income Tax Return For Regulated Investment Companies;
• Form 1120-C, US Income Tax Return for Cooperative Associations;
• Form 1120-REIT, US Income Tax Return for Real Estate Investment Trusts;
• Form 1120-L, US Life Insurance Company Income Tax Return;
• Form 1120-PC, US Property and Casualty Insurance Company Income Tax Return; and
• Form 8453 series, Form 8878 series, and Form 8879 series regarding IRS e-file Signature Authorization Forms.
The full details of the announcement on e-signatures can be found at www.irs.gov/newsroom/irs-approves-temporary-use-of-e-signatures-for-certain-forms