The Electronic Tax Administration Advisory Committee issued its annual report Wednesday, with recommendations calling on the Internal Revenue Service to expand its electronic filing efforts and digital strategy, and to offer end-to-end capabilities on online accounts for both taxpayers and tax professionals.
The ETAAC report noted that in 2016, the IRS publicly committed to a Future State Initiative and digital service model that embraces technology to improve the taxpayer service experience, in line with recommendations in ETAAC’s 2015 report. In this year’s report, ETAAC made recommendations on how the IRS should go further to optimize the taxpayer experience.
“The IRS should examine and develop end-to-end digital capabilities to help taxpayers comply with their responsibilities and interact with the IRS before, during, and after filing,” said the report.
The IRS has a Future State Initiative that fits in with ETAAC’s vision for taxpayers to be able to go online and fully understand their tax obligations, have transparent access to their tax information and status with the IRS, and securely interact with tax administrators.
The report also calls for expanded electronic filing of more tax returns, particularly for employment taxes. For the 2016 filing season, ETAAC is projecting that 86.3 percent of individual taxpayers will e-file their returns with the IRS. All other major tax returns, with the exception of employment tax returns (Form 94x series), already exceed the 80 percent e-file rate, according to the report. ETAAC pointed out that the IRS is specifically focusing on Form 94x e-file growth. To do so, the IRS plans to make improvements that may remove some existing barriers to electronic signature technology. In past reports, ETAAC has identified e-signature as a major barrier to electronic filing of the Form 94x returns series and has recommended simplifying the process to achieve higher e-filing rates.
The report also highlights the IRS’s progress on combatting identity theft and tax fraud by partnering with state tax authorities and the tax industry through its Security Summit. In next year’s report, ETAAC plans to offer recommendations to address taxpayer identity theft and Stolen Identity Refund Fraud.
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