IRS Sponsored Programs
Often individuals or organizations serve as unpaid preparers in IRS sponsored programs including Volunteer Income Tax Assistance (VITA), Tax Counseling for the Elderly (TCE), Outreach and Taxpayer Assistance Centers in IRS offices. For IRS sponsored programs, unless otherwise noted, all requirements of a Provider apply. A manual or electronic quality review system is required to review each electronically filed return. The IRS may designate an individual for this purpose. The IRS advises the VITA or TCE sponsor how to submit or transmit returns. Some options available to the IRS include:
- Submission of returns by VITA or TCE sponsors on paper, magnetic disk or in an electronic transmission to a designated IRS office;
- Submission of returns by VITA or TCE sponsors via direct transmission to the IRS; or
- Submission of returns by VITA or TCE sponsors through a third party Transmitter.
A VITA or TCE sponsor can only accept a return for electronic filing that meets the criteria for VITA or TCE assistance. A VITA or TCE sponsor may accept for electronic filing only the returns and accompanying forms and schedules included in a VITA or TCE training course. A VITA or TCE sponsor may collect a fee only if it directly relates to defraying the actual cost of electronically transmitting a tax return. A VITA or TCE sponsor may also collect this fee on behalf of a third party Transmitter that electronically transmits a VITA or TCE return. Before a VITA or TCE sponsor may collect a fee, the sponsor must advise the taxpayer that the fee is not for preparation of the return, and it offers the VITA or TCE service without regard to either the electronic filing or the collection of a fee.
A VITA or TCE sponsor and the IRS may enter into an agreement that provides for the retention of copies of tax returns, Forms 8453 and IRS e-file Signature Authorizations by the IRS. The VITA or TCE sponsor, or the IRS, must retain this information. The VITA or TCE sponsor must not give this information to a third party, including a third party Transmitter. The IRS is responsible for ensuring that the taxpayer sends Form 8453 to the appropriate IRS office or submission processing center. However, the IRS may delegate to the VITA or TCE sponsor the responsibility for mailing Form 8453 to the appropriate local office or submission processing center.
Employers Offering IRS e-file as an Employee Benefit
The following procedures apply to employers who choose to offer electronic filing as an employee benefit to business owners and spouses, employees and spouses and/or dependents of business owners and employees. These rules do not apply if an employer contracts with an ERO to originate the electronic submission of the tax return.
An employer may offer electronic filing as an employee benefit whether the employer chooses to transmit tax returns or contracts with a third party to transmit the tax returns. If an employer contracts with a third party to transmit tax returns, the employer may collect from participating employees a fee that directly relates to defraying the actual cost of transmitting the electronic portion of the tax return.
An employer and the IRS may enter into an agreement that provides for the retention of copies of tax returns, including Forms 8453 and IRS e-file Signature Authorizations. In the absence of such an agreement, the employer must retain this information. It must not give this information to a third party, including a third party Transmitter.