Archived Guidance for prior year FAQs C. Communication and General e-file # Questions Answers C1 Can a corporation that voluntarily files an electronic return, use the procedures included in “Tax Year 2013 Directions for Corporations Required to e-file”? No, “Tax Year 2013 Directions for Corporations Required to e-file” only applies to corporations required to e-file. C2 If a corporation who is required to e-file uses the procedures provided by IRS in “Tax Year 2013 Directions for Corporations Required to e-file,” is there a need to also file a waiver notifying IRS? No, if a corporation who is required to e-file follows the procedures exactly as provided by IRS in “Tax Year 2013 Directions for Corporations Required to e-file,” there is no need to file a waiver. C3 Does a corporation need special software to file an electronic income tax return? The answer depends on if the corporation uses a tax professional to prepare their income tax return or if the corporation prepares their own income tax return. If the corporation uses a tax professional to prepare the income tax return, it does not need special software to file electronically. The corporation’s tax professional will need to use software approved for electronic filing and also be an IRS Authorized e-file Provider. Taxpayers should check with their tax preparer early to ensure they are ready to file their electronic income tax return. These taxpayers should also review section D of these FAQs. Corporations that purchase tax preparation software and prepare their own income tax return should discuss the various electronic filing options with their software vendor as soon as possible. They should also review the additional information in section E of these FAQs. C4 My corporation uses tax preparation software to prepare our income tax return in-house, but after the return is complete, we contract with a tax professional to review and sign the return as paid preparer. Does my corporation need special software or will my tax professional be able to file the electronic return for me? You should discuss the preparation of your electronic return with your tax professional and/or your paid preparer. If they are an IRS Authorized e-file Provider and use the same software used by your corporation to prepare the return, they may be able to “originate” your electronic return. If the tax professional uses a different software package, you will need to follow the procedures in Publications 4163 PDF and 4164 PDF to “originate” your electronic return. C5 What if a corporation prepares the income tax return “in-house” but does not use tax preparation software? You will be required to purchase software approved for electronic filing, develop your own software, or use an IRS Authorized e-file Provider to prepare your electronic return. If you choose to develop your own software, you should contact the e-help Desk and review Publication 4164 PDF. Additionally, the software must be approved by the IRS before it can be used to file an electronic return. C6 Corporations that choose to develop their own tax preparation software must have the software approved by IRS. Does this requirement apply to corporations that use software approved for electronic filing for a portion of their return but develop their own software to prepare other portions of the income tax return? Yes, this requirement also applies to corporations that choose to develop their own software for portions of the return. You should review Publication 4164 PDF for additional information. C7 My corporation prepares our income tax return using separate tax preparation software, one for the domestic portion of the return and another for International forms (i.e. Form 5471). Assuming both have been approved for electronic filing, am I still required to transmit the entire electronic income tax return to IRS in one file? Yes, MeF can only process electronic income tax returns if the entire return is transmitted to IRS in one file. Some software vendors have developed tools to “aggregate or merge” files as outlined in your example. You should discuss your situation with both of your software vendors. C8 What is my tax preparer, ERO, or transmitter required to provide me as a copy of an electronically filed tax return? The preparer, ERO, or a transmitter must provide a complete copy of the return filed with the IRS to the taxpayer. This can be in any media, including electronic media that is acceptable to both the taxpayer and the preparer, ERO, or transmitter. A complete copy of a taxpayer's return consists of the electronic portion of the return, including all schedules, forms, PDF attachments, and jurats, filed with the IRS. The copy provided to the taxpayer must include all information submitted to the IRS to enable the taxpayer to determine what schedules, forms, electronic files, and other supporting material has been filed with the return. The copy, however, need not contain the taxpayer identification number of the paid preparer. The electronic portion of the return can be contained on a replica of an official form or on an unofficial form. On an unofficial form, however, data entries must be referenced to the line numbers or descriptions on an official form. The preparer, ERO, or transmitter should advise the taxpayer to retain a complete copy of the return and any supporting information. C9 What is the difference between an Amended and a Superseding corporate return? A superseding return is a subsequent return filed within the filing period (including extensions). A superseding return is considered the return of record because it takes the place of any other return previously filed during the filing period, with extensions. An amended corporate return is a subsequent return filed after the expiration of the filing period (including valid extensions). C10 My corporation prepares and submits more than one tax return prior to the due date, including extensions, of the return. These subsequent filings are commonly referred to as “Superseding” returns. Will my corporation be able to file more than one electronic return for the same tax period? MeF can process multiple electronic income tax returns for the same EIN and tax period. A taxpayer filing a superseding return must indicate the return is such by selecting the Superseded Return checkbox designation in the software. Additional information on filing amended and superseding returns may be found at e-file for Large and Mid-Size Corporations. The instructions relating to Amended and Superseding Returns are specific to each tax year. Go to the link for the tax year you need to update. C11 Regarding pensions, do I have to make the contributions to my pension plan before I can file the tax return that claims the deduction for the contributions? Under Code Section 404(a)(6), if the taxpayer files before the due date of the return (with extensions), so long as the deduction is on the return, the taxpayer has until the due date to make the contribution. The actual cite is: Code Sec. 404. Deduction for contributions of an employer to an employees' trust or annuity plan and compensation under a deferred-payment plan. (a) GENERAL RULE (6) TIME WHEN CONTRIBUTIONS DEEMED MADE For purposes of paragraphs (1), (2), and (3), a taxpayer shall be deemed to have made a payment on the last day of the preceding taxable year if the payment is on account of such taxable year and is made not later than the time prescribed by law for filing the return for such taxable year (including extensions thereof). C12 How can a corporation submit omitted documents after the return has been e-filed? Once a tax return has been e-filed, it is considered the return of record. Documents that were not attached when the return was e-filed cannot be considered as part of the return. There is no process to associate forgotten or missed documents with an electronic return. If a taxpayer feels that the missed or forgotten items are material enough to warrant sending to the IRS, then an amended or superseding return should be filed. Taxpayers may use MeF to file amended or superseding returns. C13 I e-filed my international Forms 5471, 5472, and 5713. Is there still a requirement to send a duplicate copy of these forms? No, you no longer need to send a duplicate paper copy of Forms 5471, 5472, and 5713 if you electronically file the original form. C14 My corporation needs to alert the IRS of certain information that will assist in the processing of our return, i.e. additional withholding credits, explanations of withholding from Schedules K-1, Forms 1099-G, etc. What would be the best format to alert the processing areas that such information exists and how to find it? Your software should provide an "Other Refundable Credits Schedule”. This schedule will allow you to itemize the additional credits and provide fields for Description, Explanation, and Amount. The sum of the additional credits will be included in the amount on Form 1120, Line 32(f). Taxpayers should contact their software developer to determine how this schedule can be completed in your software package. C15 My corporate return has an overpayment for the current tax year. We would like to designate that credit overpayment to the subsequent tax year. If circumstances change, for example a subsequent balance due as the result of an examination, can we re-designate that overpayment once our return is filed to fulfill an outstanding balance due? No. Under Revenue Ruling 77-339, 1977-2 C.B. 475, once an elected amount is credited as a payment of estimated tax for the succeeding year, it loses its character as an overpayment for the year in which it arose. IRS cannot offset a credit elect against any subsequently determined tax liability. Once a credit elect is applied, it is irrevocable. If a taxpayer needs to attach statements providing additional information or clarification, these documents should be attached directly to the return. The file should be in PDF format, the Description field should be something explanatory like “Explanation of Withholding from Schedule K-1”,“Explanation of Withholding from Form 1099-G”, etc and the file should be named something like “Explanation Of Withholding From ScheduleK-1.pdf”, “Explanation Of Withholding From Form 1099-G.pdf”, etc. This will alert the processing units that additional clarification to supplement the return information is available and how to easily identify this attachment. C16 My corporation needs to file an Application for Change of Accounting Method, Form 3115. This form must be submitted to the National Office for approval prior to the filing of the corporate income tax return. The Form 3115 instructions state to include a Power of Attorney, Form 2848, if the contact person is someone other than an individual authorized to sign the Form 3115. If my corporation submits the Form 2848, Power of Attorney, with the Form 3115, must we submit a copy of the Form 2848 as a PDF attachment with our e-filed return? No. A copy of the Form 2848, Power of Attorney, need not be submitted in PDF with the e-filed Form 1120 in cases when a Form 3115 is filed with the national office for approval or as an automatic notification. C17 My corporate e-filed return has rejected. Despite our best efforts, we cannot get this return accepted by the MeF system and have been instructed by the e-help Desk that we must file a paper return. We included a Form 8453-C/8879-C as our signature document when we e-filed the return. Is this Form acceptable as a signature for the paper-filed return? No. The Form 8453-C, U.S. Corporation Income Tax Declaration for an IRS e-file Return, and the Form 8879-C, IRS e-file Signature Authorization for Form 1120, contains representations tailored to an electronically filed corporate income tax return. The Form 8453-C declares that the corporate officer has given the electronic return originator, transmitter or intermediate service provider information that corresponds with the numbers on the Form 8453-C, and that it was true and correct. The Form 8879-C declares that the corporate officer examined the copy of the corporation's electronic income tax return and that it was true and correct. Consequently, it is improper when filing a paper Form 1120 to either use the Form 8453-C or Form 8879-C to sign the paper return. These forms do not properly make declarations that are appropriate for a filed paper return. In cases where the purported e-file return has not been accepted, no signature or signature alternative has been accepted or retained by the IRS. Accordingly, a paper return must be signed on the return to comply with the signature requirement under Code Sections 6061 and 6062. Additional guidance can be found in Publication 4163 PDF under the heading “Transmission Perfection Period” in the event that you must paper file a return which is otherwise required to be electronically filled. C18 There still appears to be some confusion regarding the electronic postmark. Is a transmitter's electronic postmark for an electronically filed federal return reflecting the transmitter's time zone deemed by the IRS to be the official filing date/time if the postmark is on/before the due date? Treas. Reg. §301.7502-1(d)3(ii) provides that the term electronic postmark means a record of the date and time (in a particular time zone) that an authorized electronic return transmitter receives the transmission of a taxpayer's electronically filed document on its host system. However, if the taxpayer and the electronic return transmitter are located in different time zones, it is the taxpayer's time zone that controls the timeliness of the electronically filed document. Based on the regulations, the Electronic Postmark is adjusted to the taxpayer’s time zone – the ERO is not mentioned in Treas. Reg. § 301.7502-1(d)(3)(ii). C19 My corporation files their income return electronically using the services of foreign return preparer. When any paid preparer information is included in the electronic file, SSN/PTIN is a required field. But foreign preparers do not have these numbers assigned to them. How can my corporation successfully complete these fields when filing an income tax return? The Preparer field in the TY2009 and TY 2008 schemas allows the preparer to enter an SSN, PTIN or EIN. For TY2007 returns, in the case of foreign return preparers, the preparer name and SSN/PTIN may be left blank in the XML file. The preparer can sign the return and supply the firm’s Employer Identification Number through the Form 8453-C, filed as a PDF attachment with the corporation's electronically filed income tax return. As such, it is considered part of the return for purposes of electronic filing of the Form 1120. This practice will fulfill the requirements of I.R.C. §§ 6109(a)(4) and 6695(c), and Treasury Regulation §§ 1.6109-2(a) and 1.6695-1(c). C20 My corporation files its return with affiliates that are based in foreign countries. We need to place these codes into various e-filing forms. How can we determine what are the proper codes to include on our e-file return for these foreign countries? List of Foreign Country Codes C21 My corporate return has backup withholding that we would like to report and submit it when we electronically file our return. How do we include these backup withholding amounts with our return? See the instructions for Form 1120 Schedule J, Line 17, regarding Backup Withholding. C22 My corporate return needs to electronically file a short period return. We would like to include an explanation of this short period return and related information. How do we include this explanation with our return? If you would like to include an explanation of the short period return and/or related information, you should include this information in a PDF file attached to the return. The Description field should be “Short Period Return” and the file should be named “ShortPeriodReturn.pdf”. This file should be attached at the top consolidated return level. The file name may contain up to 64 characters if you would like to include more detail in the name of the file, such as the corporate name. C23 My corporation will have a business need to file a superseding corporate income tax return for the same tax period prior to the extended due date of the return. We would like to include an explanation in the first filed return and advise that we will be filing a superseding return. How do we include this explanation with our return? If you would like to include an explanation, you should include this information in a PDF file at the top consolidated return level. The Description field in the XML should be “Intent To File Superseding Return Explanation” and the PDF file should be named ““IntentToFileSupersedingReturnExplanation.pdf”. The file name may be modified to contain up to 64 characters, if you would like to include more detail in the name of the file, such as the corporate name. C24 Our corporation plans to e-file our return and request a Direct Deposit using Form 8050. How quickly will we receive our refund? In general, if there are no issues that cause downstream processing problems, a corporation can expect to see their refund one week earlier than a corporate return filed on paper. C25 My corporation files a calendar year return. We filed an extension on February 15, 2013. On March 10, 2013, we filed our Form 1120 income tax return. Circumstances required us to file a subsequent return with new information for the same taxable year. We filed the second Form 1120 tax return on September 10, 2013. Since we filed an extension, we assume that our extended due date is still September 15, 2010. Is that correct? The filing of Form 1120 on March 10, 2013 does not change the September 15, 2013 due date granted with the extension. The Form 1120, filed on September 10, 2013 is considered to be a timely filed income tax return that supersedes the Form 1120 filed on March 10, 2013. C26 My corporation needs to file a Form XXX. This revision date on the form was December, 2013. However, the form which contains the updated information was not available for filing until February, 2014. Which version of the tax form should I use to e-file my return? If a form is revised within the taxpayer’s taxable year, they must use the revised form. For example, using the above dates for the form revision, if the tax year of the taxpayer ends in March 2014, then the taxpayer should use the Form XXX version February 2014. In the case of a fiscal year taxpayer whose year ends November 30, that taxpayer would use the old version of the form. Taxpayers should contact their software developer to find out what revision of the form they are supporting. Taxpayers should also check the latest known issues file to find out if the IRS has any special instructions in case the latest revision of the form is not available in the schema package for the tax year the filer needs to file. C27 What is the purpose of each of the three general dependencies that are now available and when should I use them? The general dependency was created to allow for the submission of information that is not specified in a predefined schema. Beginning in processing year 2010, there are three general dependencies: "General Dependency”, available for Forms 1120, 1065 and 1065-B, is attached at the return level and allows for an explanation of up to 1,000,000 characters (efile type is long explanation type). “General Dependency Medium”, available for Forms 1120-F, 1120S, 720, 2249 and 8849, is attached at the return level and allows for an explanation of up to 100,000 characters (efile type is medium explanation type). “General Dependency Small” is attached at the form or schedule level and allows for an explanation of up to 5,000 characters (efile type is text type with maximum length 5,000 characters). See FAQ C32 above for a situation that requires the use of the The General Dependency Small is available for: Form 851 Form 926 Form 1118 Form 1118AMT Form 4136 Form 4562 Form 4684 Form 5713 Form 5471 Form 6765 Form 8586 Form 8834 Form 8865 Form 8886 Schedule M-3 (Form 1120) Schedule M-3 (Form 1120L) Schedule M-3 (Form 1120PC) Schedule M-3 (Form 1120S) Schedule M-3 (Form 1065) Schedule K-1 (Form 1065) C28 My corporation intends to elect to carry back an applicable net operating loss (NOL) under section 172 of the Worker, Homeownership, and Business Assistance Act of 2009. Revenue Procedure 2009-52 states that the taxpayer should attach a statement to its federal income tax return or an amended return for the taxable year of the applicable NOL. The election statement must state that the taxpayer is electing to apply § 172(b)(1)(H) or § 810(b)(4) under Rev. Proc. 2009-52, and The taxpayer is not a Troubled Asset Relief Program (TARP) recipient nor, in 2008 or 2009, an affiliate of a TARP recipient. The statement must specify the length of the NOL carryback period the taxpayer elects (3, 4, or 5 years). How do I satisfy these conditions if I am electronically filing my initial or amended return? Revenue Procedure 2009-52 states that the taxpayer that filed its federal income tax return for the taxable year of the applicable NOL may make the election by attaching a statement to its original or amended return for the taxable year of the applicable NOL. A corporation that is filing their return electronically may create a General Dependency and enter WHBA-Rev Proc 2009-52 in the description field. Provide the statement “XXXX NOL Carryback Election Pursuant to Rev. Proc. 2009-52” (where XXXX is the year), and include the information in the three bullets above. C29 I need to file an amended return for my Form 1120/1120S/1120-F. The Service has requested that the amended return be filed with the IRS Service Center where the original return was filed; in addition, the Service requires I indicate on the amended return the Service Center where the original return was filed. I voluntarily e-filed my Form 1120/1120S/1120-F. As such, which Service Center do I state on my amended return if the original Form1120/ 1120S/ Form 1120-F were e-filed? If you e-filed your original return and are now filing a paper amended return, you should send it to the campus where you would have filed the original (based on the form instructions), had it been filed on paper.For example, if the corporation's principle business office is located in Michigan and your total assets at the end of the tax year are less than $10 million and you are not required to file Schedule M-3, then you were required to file at the Cincinnati Campus. Therefore, you should state Cincinnati Campus on your amended return. If you are required to e-file under T.D. 9363, you are also required to e-file any amended returns. C30 If I am an employee of a business and prepare the business tax returns as part of my job responsibilities, am I required to obtain a PTIN? No. An employee who prepares his employer’s returns is not required to sign as a paid preparer. Accordingly, unless the employee prepares other federal tax returns for compensation, he or she is not required to register and obtain a PTIN. For additional information on New Requirements for Tax Return Preparers C31 I am preparing my client's income tax return and plan to use the Form 8879, IRS e-file Signature Authorization, when filing electronically. What are my responsibilities as a paid preparer relative to the Form 8879? You should provide the client with a copy of the return for review and signature in a format and media agreeable to you and the client (XML version, paper version, pdf of paper version etc), along with the Form 8879 for the client to sign and return to you. You, as the preparer, should retain a copy of the return finally approved and signed by the client using the Form 8879. The copy of the return provided to the client and retained in the preparer's records is not required to include the preparer's signature. See Treas. Reg. § 1.6695-1(b)(2). Only the return electronically filed with the IRS is required to be signed by the preparer. Treasury Regulation section 1.6107-1(a) provides in part: (a) Furnishing copy to taxpayer--(1) A person who is a signing tax return preparer of any return of tax or claim for refund of tax under the Internal Revenue Code shall furnish a completed copy of the return or claim for refund to the taxpayer (or nontaxable entity) not later than the time the return or claim for refund is presented for the signature of the taxpayer (or nontaxable entity). The signing tax return preparer may, at its option, request a receipt or other evidence from the taxpayer (or nontaxable entity) sufficient to show satisfaction of the requirement of this paragraph (a). 2) The tax return preparer must provide a complete copy of the return or claim for refund filed with the IRS to the taxpayer in any media, including electronic media, that is acceptable to both the taxpayer and the tax return preparer. In the case of an electronically filed return, a complete copy of a taxpayer's return or claim for refund consists of the electronic portion of the return or claim for refund, including all schedules, forms, pdf attachments, and jurats, that was filed with the IRS. The copy provided to the taxpayer must include all information submitted to the IRS to enable the taxpayer to determine what schedules, forms, electronic files, and other supporting materials have been filed with the return. In addition, you should retain a copy of the completed Form 8879 in your files for three years from the return due date or the date the IRS received the return, whichever is later. Do not send a copy of the completed Form 8879 to the IRS unless requested to do so.