BTB Stock Income Tax Updates

IRS Extends Electronic Signatures and Encrypted Email

On March 27, 2020, the IRS issued guidance allowing for the acceptance of digital signatures and the receipt and transmission of documents via email during compliance interactions. The IRS also permitted the use of electronic or digital signatures on certain paper forms that required a handwritten signature. These digital flexibilities were subsequently extended to Oct. 31, 2023. The IRS has extended these temporary flexibilities. The acceptance of digital signatures is extended indefinitely until more robust technical solutions are deployed, and encrypted email when working directly with IRS personnel has been extended until Oct. 31, 2025.

Activated during the COVID-19 pandemic, the flexibilities promoted secure and effective communications and were well received by tax professionals and taxpayers who reported that allowing for the use of electronic or digital signatures saved time and resources.

As a result, Internal Revenue Manual (IRM) 10.10.1 was updated to allow the acceptance of alternatives to handwritten signatures for certain tax forms and the ability to accept images of signatures and digital signatures in compliance interactions. A listing of allowable signature options can be found in IRM Exhibit 10.10.1-2.

In addition, Interim Guidance Memorandum PGLD-10-1023-0002 provides for the receipt and transmission of documents through Oct. 31, 2025, using email with encryption when working person-to-person with IRS personnel to address compliance or resolve issues in ongoing or follow-up authenticated interactions (primarily with field compliance, Independent Office of Appeals, Counsel and Taxpayer Advocate Service personnel). This guidance remains in effect until the IRS fully implements long-term solutions for secure electronic communication channels with taxpayers as alternatives to encrypted email.

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