The new year will be here before you know it. Cross these items off your list before January starts!
Communicate Year-End Tax Planning Tips
Reach out to your clients with tax planning information they should take care of for the end of the year, such as charitable and retirement contributions and college planning. Check out this comprehensive list from CPA Practice Advisor for more help!
Update e-Services Information
E-Services from the U.S. Internal Revenue Service (IRS) offers a suite of tools to assist tax pros. These tools include the e-file application, the Transcript Delivery System (TDS) and a secure mailbox. New e-Services users must first register and verify their identities using Secure Access authentication.
Principals, principal consents or authorized responsible officials/delegated users must update the e-file application to ensure that all contact information is accurate. Individuals no longer associated with the firm must be removed from the application.
New delegated users must be added to the e-file application. Firms that will need to use the e-Services TDS should ensure the appropriate people are approved on the application to avoid any delays in accessing client transcripts.
Firms opening new offices where electronic transmissions will occur also must submit new e-file applications. E-file providers should review Publication 3112, IRS e-file Application and Participation, to determine additional actions they should take.
The IRS reminds tax pros that the Electronic Filing Identification Number (EFIN) is not transferrable and cannot be sold, rented, leased or provided with software purchased. It can only be obtained from the IRS. Providers who sell, transfer or close their business operations must notify the IRS within 30 days.
Anyone who prepares or helps prepare tax returns for compensation must have a Preparer Tax Identification Number (PTIN) and renew it each year. Tax preparers have until Dec. 31, 2019, to renew or register for PTINs for the 2020 filing season. Anyone who is an enrolled agent must also have a PTIN and renew it annually.
Familiarize Yourself With TAX Site
All forms and information for Virginia tax preparers is available on the Virginia Department of Taxation website. Sign up for email updates as well so you're always in the loop.
Update Power of Attorney/Third-Party Authorization Records
Tax pros who have existing power of attorney or third-party authorization (Forms 2848 and 8821) for clients should review those records. If the taxpayer is no longer a client, tax professionals should submit revocations to end the authorization. They can follow the revocation instructions outlined in Publication 947, Practice Before the IRS and Power of Attorney. This will help safeguard taxpayer records.
Review Security Safeguards
All paid tax preparers, regardless of firm size, must have written information security plans as required by the Federal Trade Commission. IRS Publication 4557, Safeguarding Taxpayer Data, offers an overview of basic security measures and information about the FTC’s Safeguards Rule.
Now also is a good time for tax professionals to hire a cybersecurity expert to review office digital safeguards. At a minimum, tax pros should perform a “deep scan” for viruses on all digital devices. Other security tips are available at Taxes-Security-Together Checklist. Tax pros should protect both their PTIN and EFIN from theft.
Review Practitioner Priority Service Options
The Practitioner Priority Service (PPS) is any tax pro’s first point of contact for account-related issues. Before calling, they should be sure to review the PPS page. Faster solutions are often available on IRS.gov. The quickest way to obtain a client’s transcripts is by using IRS e-Services and the Transcript Delivery System. After registering for e-Services, tax pros can receive account transcripts, wage and income documents, tax return transcripts, and verification of non-filing letters online.
Tax pros must verify their identity before PPS representatives can provide help. This process includes providing their Social Security number and date of birth. If a tax pro has a client in the room, they should consider having them step out or, alternatively, ask the client to make an oral disclosure authorization or oral tax information authorization to the IRS representative.