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Efiling for others

JerryB
Level 2

I am a relatively new EFIN user.

A family owned company has approached me with the idea that they will buy the Lacerte program to self prepare the family S corp and several individual returns.

A family member will prepare these returns as a non paid preparer. 

They want to provide me with a backup of the prep files for me to complete the efile though my Lacerte and with my EFIN. 

In turn I will pass on to them the filing fees, but no other charges on my part. 

Is this possible and if so, what is the best way to proceed?

Thanks for any help.

Jerry

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JerryB
Level 2

Prepared with the proper questions here is what I found on the IRS website under FAQs for EFIN:

Can my firm e-file a return for a taxpayer which my firm did not prepare?

Yes, as long as my firm gets the return directly from the taxpayer.

 

 

I am much obliged and appreciate everyone's help.

In the future I will try a little more due diligence on my own before I bother the busy but helpful community. 

View solution in original post

17 Replies 17
Just-Lisa-Now-
Level 15
Level 15
There has been some discussion as to how much liability you may have for Efiling returns that you didnt prepare/review under your firm name/EFIN.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
JerryB
Level 2

I suspected this idea was not going to be straight forward. 

There are always wrinkles. 

Any suggestions where I might start looking for more info?

thanks, 

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Just-Lisa-Now-
Level 15
Level 15
Im sure more people will comment on this soon.

Ive never had this type of situation presented to me, so I havent really dug around looking into it personally.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
George4Tacks
Level 15

Does the family member have a PTIN?

Is this family member on payroll, or ownership of this S-Corp? I think they might be considered to be a paid preparer. 

You will process for no cost? Why?

 


ex-AllStar
JerryB
Level 2

the member of the S corp family does not have a PTIN.

The family member is on the payroll as an employee of the S corp but I believe, if I am reading it correctly, he is not considered a paid preparer per section (f): Persons who are not tax return preparers:

26 CFR § 301.7701-15

(ix) An individual preparing a return or claim for refund of a taxpayer, or an officer, a general partner, member, shareholder, or employee of a taxpayer, by whom the individual is regularly and continuously employed or compensated or in which the individual is a general partner.

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TaxGuyBill
Level 15

This isn't what you are asking about, so feel free to ignore this, but this is just my personal opinion about that situation:

Do-it-yourselfers should NOT be doing corporate returns.  I would not want to do anything to encourage them to do so (such helping them with the e-filing).

JerryB
Level 2

so noted. 

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IRonMaN
Level 15

I don't know, maybe I'm just a dinosaur who lived through the Ice Age but I don't want my name associated with any tax return I didn't prepare.  If my name is associated with the return, I wouldn't just grab the return and transmit it without going through the return to make sure it was correct.  


Pot Stirrer Gold Medalist - Rio de Janeiro Games
JerryB
Level 2

As I noted, I am somewhat new to this so I have some basic questions.

The IRS wants/requires everyone to efile.

How would a mom and pop efile a return they prepared on their kitchen table? 

Are there not services out there designed to facilitate efiling?

In pursuit of its goal, I would think the IRS would encourage a system to efile other people's returns without burdening the e-filer with penalties meant for a preparer or requiring the e-filer to "review" the return for other than e-file compatibility diagnostics. 

Leaning in this direction might suggest the IRS wants/requires everyone to engage a paid preparer.

That just seems a little draconian.  

 

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IRonMaN
Level 15

"Free-file" is available to a lot of folks.  They can buy Turddotaxx or some other DIY software.  They can pay a professional to prepare the return for them.  So there are options.


Pot Stirrer Gold Medalist - Rio de Janeiro Games
George4Tacks
Level 15

"The IRS wants/requires everyone to efile." The key word is wants. There is no personal requirement.

Three free options:

  1. AARP Tax-Aide https://www.aarp.org/money/taxes/aarp_taxaide/
  2. VITA https://www.irs.gov/individuals/free-tax-return-preparation-for-qualifying-taxpayers
  3. Free File https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free

Congress has written tax law such that is almost impossible for the average (or even more so for the less than average) taxpayer to complete their own return. The most draconian device is allowing tax return RAPID REFUND or other expensive options to get your refund NOW, because you don't have a bank account or can't wait two weeks to get the check that will cost you money to cash. YES, THE SYSTEM SUCKS!

How much responsibility do you want to take on for the work of others. Your EFIN can be revoked. Is it worth loosing an EFIN to be a good guy?


ex-AllStar
JerryB
Level 2

There is great value in learning what questions to ask.

Per your reply it appears the question is about my EFIN responsibilities and the risk of having the EFIN revoked. 

Thank you for helping to center the focus of my question.

I will do some research to determine the extent of due diligence imposed on an e-filer of a return not prepared by the efiler.

I suspect there is considerable due diligence imposed on the efiler to confirm the identity of the taxpayer.

And perhaps there is simply a prohibition against it.

thanks again.

 

JerryB
Level 2

Prepared with the proper questions here is what I found on the IRS website under FAQs for EFIN:

Can my firm e-file a return for a taxpayer which my firm did not prepare?

Yes, as long as my firm gets the return directly from the taxpayer.

 

 

I am much obliged and appreciate everyone's help.

In the future I will try a little more due diligence on my own before I bother the busy but helpful community. 

View solution in original post

qbteachmt
Level 15

"In the future I will try a little more due diligence on my own before I bother the busy but helpful community."

Oh, nonsense; it's a great topic. I would recommend doing it here, though:

https://proconnect.intuit.com/community/practice-advice/discussion/02/214

The other comment I forgot to put is that, spending time on this client means not spending time with paying clients. It's not wrong to do something like this, for instance, as a type of marketing to them to give you their 500 corporate returns for Payment. Just don't overlook your true costs.

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"Level Up" is a gaming function, not a real life function.
JerryB
Level 2

thank you for link; I've got it bookmarked for future reference. 

 

qbteachmt
Level 15

Okay; I counsel business people, so I will take this one:

"In turn I will pass on to them the filing fees, but no other charges on my part."

You just completely devalued yourself and your professionalism to them.

You are being asked to provide something of value to them, that also costs you.

What about your programs, your computer equipment and your connection costs? You are putting your own E&O at risk, as well. All of this has some value to be recaptured. It's one thing not to charge your usual rate, or have the intent not to profit, or be willing to work for free. It's another to be paying for all of the infrastructure you are providing to them. Otherwise, why don't they do all of it in house and without you? The answer is, they find some value in your involvement. That is either Nefarious or Innocent, but not Free to you. Why should it be free to them?

Here's one example: I own and update more than one computer, so that if something dies in the middle of the time I need it, I move over to the other one. That costs me time and money to have a "spare" on hand that is ready to go, and as a professional, I am willing to invest in that provision.

 

*******************************
"Level Up" is a gaming function, not a real life function.
JerryB
Level 2

thank you for your counsel.

I want you to know your advice is valued, even though provided gratis. 

kind regards.