IRS mandates e-filing
- By David Perera
- Jan 10, 2005
Officials at large companies and tax-exempt organizations must electronically file their Internal Revenue Service forms starting in 2006, tax agency officials announced today.
The new regulations will first apply to corporations worth more than $50 million and tax-exempt organizations with assets of at least $100 million.
The threshold lowers in 2007 to businesses and tax-exempt organizations worth $10 million. IRS officials expect that by then at least 20,000 large corporate taxpayers and up to 10,000 tax-exempt entities will be covered by the electronic filing requirement.
Companies that file fewer than 250 annual IRS returns -- such as income, excise, information and employment tax forms -- will be exempt from the new electronic submission rules, however.
This technology mandate will reduce the completion time of audits, said Mark Everson, IRS commissioner. "This is important because audits, on average, take five years to complete for large corporations," he said in an agency release. "Speeding processing also will help identify emerging trends and abuses earlier, enabling the IRS to address problems before they get out of hand."
There are no current plans to extend the electronic filing requirement to small businesses, according to the release, although "all taxpayers are strongly encouraged to adopt electronic filling."
David Perera is a special contributor to Defense Systems.