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 will 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:
- Form 94x Series
- Form 1120/1120S
- Form 8850
- Internet Employer Identification Number (EIN)
- Harmonized Wage Reporting
- Single Point Electronic Filing of Form W-2/3
- Standardized EIN
The Forms 94x Series project will enhance and expand electronic filing options for the 94x family of forms (Employment Tax). The 1120/1120S project will enable, for the first time, electronic filing for Forms 1120/1120S (Corporate Income Tax). These projects provide 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 will give IRS the capability to expand the suite of tax returns that can be filed electronically in a relatively expeditious manner as it will no longer need 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). In Phase 1 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 agency responsible for determining policy and procedures for the form’s processing (Department of Labor) will analyze the focus of follow-on activities.
The Internet EIN project will provide 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 will be 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. The current focus of these projects is the completion of selected tasks within the President’s Management Agenda timeframe.