Expanded 120-Day Time Window Applies to Disclosure Authorizations; IRS Requests Comments on Rule Change
IR-2009-122, Dec. 31, 2009
WASHINGTON — A new rule has expanded to 120 days the time period during which the Internal Revenue Service may share a taxpayer’s tax-return information with third parties, based on a taxpayer’s written disclosure authorization.
The newly-expanded time window is retroactive to Oct. 19, 2009. Consequently, any disclosure authorization signed and dated by a taxpayer on or after Oct. 19 qualifies for the new 120-day window. Forms affected by this change include:
- Form 4506, Request for Copy of Tax Return,
- Form 4506-T, Request for Transcript of Tax Return,
- Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript and
- Form 8821, Tax Information Authorization.
Many taxpayers use these forms to authorize the sharing of their tax information with others, including financial service providers. The IRS will share the requested information with the designated third party, as long as the agency receives the disclosure authorization within 120 days of the date it is signed and dated by the taxpayer.
The IRS on Dec. 18, 2009 released Notice 2010-8, which set forth an interim rule extending from 60 to 120 days the period within which signed and dated authorizations to disclose taxpayers’ tax-return information to third parties must be received by the IRS in order to be effective. The IRS made this change because some institutions charged with assisting taxpayers in their financial dealings have encountered difficulty in obtaining written disclosure authorizations and submitting them to the IRS within the 60 days allowed by the existing regulation. The interim rule will remain in effect until the IRS amends the regulations under section 6103(c) of the Internal Revenue Code.
The IRS welcomes comments on the proposed changes to the regulations. Comments must be received by Jan. 25, 2010, and may be submitted electronically, by mail or by hand delivery to the IRS. Notice 2010-8 provides additional details on the submission of comments.