Surprise! You Will E-File

Ya gotta love our system of government. You have a bill that has passed the House by a pretty good margin. It goes to the Senate where this amendment is added. The Senate passes the bill 98-0. Back to the House. They vote to accept the Senate version by 402 to 12 margin and off to the President it goes. There it is sure to be signed since there are some important economic measures and it's veto proof. Almost like the Schoolhouse Rock segment.

This, however, is HR 3548 - The Worker, Home Ownership and Business Assistance Act of 2009. A bill all expected to pass since it extends unemployment benefits and the First Time Homebuyer's Credit. And now a preparer e-filing mandate. From Section 17:

`(3) SPECIAL RULE FOR TAX RETURN PREPARERS-
`(A) IN GENERAL- The Secretary shall require than any individual income
tax return prepared by a tax return preparer be filed on magnetic media
if--
`(i) such return is filed by such tax return preparer, and
`(ii) such tax return preparer is a specified tax return preparer for the
calendar year during which such return is filed.
`(B) SPECIFIED TAX RETURN PREPARER- For purposes of this paragraph,
the term `specified tax return preparer' means, with respect to any
calendar year, any tax return preparer unless such preparer reasonably
expects to file 10 or fewer individual income tax returns during such
calendar year.
`(C) INDIVIDUAL INCOME TAX RETURN- For purposes of this paragraph,
the term `individual income tax return' means any return of the tax
imposed by subtitle A on individuals, estates, or trusts.'.

Much discussed but not expected to be seen for a while, we now have e-file mandates for preparers of federal returns. That means if you prepare over 10 returns you have to send them electronically. Many states have set up mandates to push preparers into the modern age. But the last time I heard Federal mandates discussed at a workshop, the idea was still sometime away. The IRS was hoping to leading the paper preparers with honey and not legislative vinegar. I honestly didn't expect to see anything until there was a bill for tax preparer registration/licensing. I also expected to see a higher number of returns before the mandate kicked in and then reduced over time.

Preparers have a year to prepare to convert their office to e-file. The bill goes into effect for returns filed after 12/31/2010. And I am sure we will be hearing a lot about this over the next year.

Comments

[Marti Skaggs]

Hi my name is Marti and I write a paper on your blog every week and this week you didn't give me very much to write about, thanks.