IRPAC: Establish tax pro ACA accounts, change W-9
The IRS’s Information Reporting Program Advisory Committee released its new annual report, offering numerous recommendations to the service, including improvements to processes for penalties, abatement requests and levies, as well as business master file entity addresses and establishment of online accounts for tax pros. The committee also talked with IRS officials regarding reporting requirements under FACTA and the Affordable Care Act.
Among its recommendations were:
- Online tax professional ACA accounts. An online account for tax professionals would enable tax professionals to manage authorizations online and provide access to some of their client’s information.
- W-9 enhancements. Withholding agents can accept W-8s with an e-signature, and the IRS now allows use of W-8s collected and maintained by a third-party repository; IRPAC recommended that the IRS extend these policies to the W-9.
- Penalties, abatement request and levies process. The cap on 972CG penalties has increased from $250,000 to $3,196,000, even as the IRS has lost a significant number of experienced agents who were previously responsible for reviewing reasonable cause abatement requests. IRPAC recommended that the IRS utilize the reasonable cause guidance provided in Sec. 6724 and Pub. 1586.
- Business master file entity addresses. The committee recommended that the IRS immediately implement procedures that require the receipt of a completed IRS 8822-B prior to any action taken to update a filer’s address. The IRS should no longer rely on the address used on previously filed returns to update the filer’s address, especially when that filer has no previous history of filing these types of business forms.
The report also addressed recommendations regarding employer information reporting and burden reduction for the ACA, including “good faith efforts” penalty relief and recommending an extension of the 30-day delay for furnishing 2017 1095-Bs and 1095-Cs; updating the Combined Federal State Filing Program and modification of W-2 instructions to allow for truncation of Social Security numbers based upon the PATH Act; digitizing processes involved with Forms 2553, 2848 and 8655; and a number of recommendations regarding international withholding and reporting.