Wednesday, December 22, 2010

Hardship Waiver Form Released by IRS to File for Electronic Filing Exemption

The IRS has finally released the form 8944 tax preparers need to allow for them to fill for a waiver from the new electronic filing requirements that take effect in 2011. So if you need to file that form get it done as the IRS has said that time is of the essence in this matter and failure to file it ASAP will result in it's not being approved.

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IRS Releases Electronic Filing Hardship Waiver Form for 2011

The Internal Revenue Service Dec. 20 released Form 8944, Preparer e-file Hardship Waiver Request (PDF), which will be used by tax preparers who want a waiver from new electronic filing requirements.

The form will apply to tax preparers whose firms, in the aggregate, expect to file 100 or more income tax returns for individuals, estates, or trusts in calendar year 2011,  Announcement 2010-96 said.

IRS promised in Dec. 2 guidance that preparers who meet the definition of a “specified tax return preparer,” and who believe they qualify for an undue hardship waiver, would be allowed to voluntarily submit waiver requests to IRS prior to publication of a final revenue procedure.

While the threshold is 100 or more returns in calendar 2011, that threshold will drop to 11 or more of the specified returns prepared in the aggregate for 2012, IRS said.

The instructions warn preparers within a firm that, even if they individually prepare fewer than 100 returns, they may be required to e-file if the firm exceeds the threshold for 2011.

Reasons IRS listed for possibly requesting a waiver included bankruptcy, economic hardship, disaster situations or “other.”

The filer must provide current cost estimates of the software, connectivity, or other services needed to e-file their clients' returns for the calendar year, and attach two written cost estimates. Failure to provide the cost estimates will result in denial of the waiver, IRS said.

For calendar year 2011, hardship waiver requests must be submitted from December 2010 through April 1, 2011. Any request submitted after the required date will only be reviewed under limited circumstances, IRS said in the instructions.

Preparers were encouraged to submit the waiver requests as soon as possible so IRS would have time to review them.

Announcement 2010-96 will be published in Internal Revenue Bulletin 2010-52 on Dec. 27.


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