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IRS allows more forms to be signed digitally due to coronavirus

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The Internal Revenue Service added six more forms to the 10 that can be signed digitally by taxpayers and tax professionals as the COVID-19 pandemic continues to make it difficult for tax practitioners and their clients to meet in the same room.

Last month, the IRS announced it would temporarily allow the use of digital e-signatures on some forms that can’t be filed electronically to reduce the risk to taxpayers and tax professionals of in-person contact during the novel coronavirus pandemic (see story).

The IRS has long allowed the use of e-signatures on the Form 1040 by taxpayers and preparers who have selected a PIN for security. Over 90 percent of 1040 forms are already filed electronically. But the 16 forms now permitted for digital signatures come in direct response to the pandemic and the need for social distancing. The IRS said Thursday it made the decision to help protect the health of taxpayers and tax professionals during the pandemic. “The change will help to reduce in-person contact and lessen the risk to taxpayers and tax professionals, allowing both groups to work remotely to timely file forms,” said the IRS.

The IRS added the following forms to the list of those being accepted digitally:

  • Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
  • Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
  • Form 709, U.S. Gift (and Generation-Skipping Transfer) Tax Return;
  • Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons;
  • Form 3520, Annual Return To Report Transactions With Foreign Trusts and Receipt of Certain Foreign Gifts; and
  • Form 3520-A, Annual Information Return of Foreign Trust With a U.S. Owner.

The forms are available at IRS.gov and through professional tax software products. The forms cannot be e-filed and generally are printed and mailed.

The list below was announced last month:

  • Form 3115, Application for Change in Accounting Method;
  • Form 8832, Entity Classification Election;
  • Form 8802, Application for U.S. Residency Certification;
  • Form 1066, U.S. Income Tax Return for Real Estate Mortgage Investment Conduit;
  • Form 1120-RIC, U.S. Income Tax Return For Regulated Investment Companies;
  • Form 1120-C, U.S. Income Tax Return for Cooperative Associations;
  • Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts;
  • Form 1120-L, U.S. Life Insurance Company Income Tax Return;
  • Form 1120-PC, U.S. 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 forms can be submitted with digital signatures if mailed by or on Dec. 31, 2020,

The IRS plans to continue monitoring the temporary option for e-signatures and decide if more steps are needed. The agency also expects to continue to review its processes to see where long-term actions can help reduce the burden on the tax community, while balancing that with security needs and protection against identity theft and fraud.

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IRS Tax forms E-signature Coronavirus