It's Time to Get Your EFIN

A few years ago, Congress mandated e-filing of all 1040 and 1041 by tax return preparers. The rule includes anyone who prepares at least 11 returns in the year.

Currently, an application to e-File can be made by filing Form 8633 or online through e-Services. Once processed, the applicant will be issued an EFIN (Electronic Filing Identification Number) which will allow them to e-file the returns they applied to file. But the IRS is changing the application process beginning October 1^st. At that time, all applications to e-file must be made online through e-Services.

e-Services is an IRS program that allows tax pros to provide to and receive information from the IRS. A preparer’s e-File application has long been online and available to update information such as the preparer’s address, phone and types of returns they want electronically file. (But even better, e-Services allows tax pros to easily get info for clients or file Form 2848 (Power of Attorney) but that’s another post.)

After September 30^th, preparers will have to set up an e-Service account before they can apply to e-file. The IRS warns that this alone can take several weeks to do. Once the e-Services account is set up, the preparer can complete the e-File application. Since that includes suitability checks, the IRS estimates the process to take 6 weeks.

If you are new to the tax business or newly out on your own, this is the time when you want to think about getting your EFIN. You don’t want to wait until the last minute and find that you can’t electronically file returns when the filing season opens for 2012 returns because you don’t have your EFIN yet.

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