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Presidential Initiatives

Expanding Electronic Tax Products For Businesses

Program Managers

David Williams

Managing Partner

Department of the Treasury

Description

Reduces the tax-reporting burden on businesses while improving the efficiency and effectiveness of government operations, provides timely and accurate tax information to businesses, increases the availability of electronic tax filing, and models simplified federal and state tax employment laws.

Progress to Date
  • Nationwide deployment of Form 94x/Employment Tax
  • Completed proof-of-concept for Pre-Screening Notice and Certification Request for the Work Opportunity and Welfare-to-Work Credits (Form 8850)
  • Nationwide deployment of Internet Employer Identification Number (EIN)
  • Nationwide deployment of Form 1120 Corporate Income Tax
  • Nationwide deployment of Form 990 Return of Organization Exempt from Income Tax
  • Implementation of One Stop EIN with at least one state. One Stop EIN reduces burden for businesses by allowing them the opportunity to apply for and receive their Federal Employer Identification Number (EIN) online while they register for their state identification number in one process

Next Steps
  • Monitor and report on performance metrics for the initiative

Performance

EETPB Metrics

Exhibit 300

Not available - has always been included as component of larger Treasury investment (Modernized e-File)

 

The objective of the Expanding Electronic Tax Products for Businesses initiative is to reduce the tax-reporting burden on businesses while improving the efficiency and effectiveness of government operations. The initiative is comprised of seven projects that deliver benefits by reducing the number of tax-related forms that businesses must file, providing timely and accurate tax information to businesses, increasing the availability of electronic tax filing, and modeling simplified federal and state tax employment laws. These projects include:

  1. Form 94x Series
  2. Form 1120/1120S
  3. Form 8850
  4. Internet Employer Identification Number (EIN)
  5. Harmonized Wage Reporting
  6. Single Point Electronic Filing of Form W-2/3
  7. Standardized EIN

The Forms 94x Series project has enhanced and expanded electronic filing options for the 94x family of forms (Employment Tax). The 1120/1120S project enabled, for the first time, electronic filing for Forms 1120/1120S (Corporate Income Tax). These projects provided the initial focus for IRS’ implementation of the Extensible Markup Language (XML). XML is a data format standard developed to facilitate the transmission of information over the Internet. The use of this standard has given IRS the capability to expand the suite of tax returns that can be filed electronically in a relatively expeditious manner as it no longer needs to develop form specific, or proprietary, software to receive the forms.

The objective of the Form 8850 project is to provide an electronic version of Form 8850 (Pre-Screening Notice and Certification Request for the Work Opportunity and Welfare-to-Work Credits). The IRS developed and tested a proof-of-concept for an electronic version of Form 8850 with a select group of employers, partners, and states.

The Internet EIN project provides a web-based opportunity for employers, tax practitioners and financial institutions to apply for and receive a validated Employer Identification Number (EIN) directly from IRS. Businesses are able to log onto a secure, government web site from their office, bank or a state agency and file an electronic Form SS-4 (Application for Employer Identification Number) and receive their EIN during the same session.

The Harmonized Wage Reporting, Single Point Electronic Filing of Form W-2/3, and Standardized EIN projects were initiated under a multi-agency partnership that was focused on reducing taxpayer burden through the simplification of tax and wage reporting regulations.