Iowa Administrative Code › Agency 701 - Revenue Department › Title I - Administration › Chapter 8 - Forms and Communications › Rule 701-8.5 - Electronic Filing of Iowa Income Tax Returns

Current through Register Vol. 47, No. 3, July 24, 2024
There is no statutory requirement that taxpayers file their
				  Iowa income tax returns electronically. Taxpayers also have the option to file
				  by paper. However, electronic filing allows individuals and businesses that
				  meet department criteria to file their Iowa income tax returns electronically.
				  When a taxpayer files an electronic return, all information related to the
				  return should be electronically transmitted. No information is to be submitted
				  on paper unless specifically requested by the department. A taxpayer's
				  electronic Iowa return shall include the same information as if the taxpayer
				  had filed a paper return.
(1)
Definitions.
For the purpose of this rule, the following
				definitions apply, unless the context otherwise requires:
"Acknowledgment"
means a report generated by
				  the department and sent electronically to a transmitter via the IRS indicating
				  the department's acceptance or rejection of an electronic submission.
"Declaration for e-File Return form"
means a
				  taxpayer declaration form that authenticates the electronic tax return,
				  authorizes its transmission, and consents to the financial transaction order as
				  designated using the financial institution information provided.
"Direct debit"
means an order for electronic
				  withdrawal of funds from a taxpayer's financial institution account for payment
				  to the department.
"Direct deposit"
means an order for
				  electronic transfer of a refund into a taxpayer's financial institution
				  account.
"E-file provider"
means a firm that is
				  assigned an Electronic Filing Identification Number (EFIN) by the IRS to assume
				  any one or more of the following IRS e-file provider roles: electronic return
				  originator, intermediate service provider, transmitter, software developer, or
				  reporting agent.
"Electronic filing"
means a paperless filing
				  of the Iowa income tax return, order for financial transaction, or both by way
				  of the IRS e-file program, also known as federal/state electronic filing
				  (MeF).
"Electronic return originator (ERO)"
means
				  an authorized IRS e-file provider that originates the electronic submission by
				  any one of the following methods: electronically sending an electronic tax
				  return to a Transmitter that will transmit the electronic tax return to the
				  IRS, directly transmitting the electronic tax return to the IRS, or providing
				  the electronic tax return to an Intermediate Service Provider for processing
				  prior to transmission to the IRS.
"Electronic signature"
includes data in
				  electronic form, which is logically associated with other data in electronic
				  form and executed or adopted by a person with the intent to sign a document.
				  This type of signature has the same legal standing as a handwritten signature
				  if the requirements in either paragraph 8.5(2)
"b"
or
"c"
are met. Electronic signatures appear in many forms and
				  may be created by many different technologies. No specific technology is
				  required.
"Intermediate service provider"
means the
				  firm that assists with processing submission information between the ERO (or
				  the taxpayer in the case of online filing) and a Transmitter.
"Online filing"
means the process for
				  taxpayers to self-prepare returns by entering return data directly into
				  commercially available software, software downloaded from an Internet site and
				  prepared off-line, or through an online Internet site.
"Origination of an electronic return"
means
				  the action by an ERO of electronically sending the return directly to an
				  Intermediate Service Provider, a Transmitter, or the IRS.
"Reporting agent"
means a firm that
				  originates the electronic submission of certain returns for its clients or
				  transmits the returns to the IRS in accordance with the IRS electronic filing
				  procedures, or both.
"Software developer"
means an approved IRS
				  e-file provider that develops software according to IRS and Iowa specifications
				  for the purposes of formatting electronic returns, transmitting electronic
				  returns directly to the IRS, or both. A software developer may sell its
				  software.
"Stockpiling"
means collecting returns from
				  taxpayers or from other e-file providers and waiting more than three calendar
				  days after receiving the information necessary for transmission to transmit the
				  returns to the department.
"Transmitter"
means a firm that transmits
				  electronic tax return information directly to the IRS and routes electronic
				  acknowledgments from the IRS (and the states) to the firm originating the
				  electronic return.
(2)
Completion and documentation of the electronic return.
a. The electronic submission must match the
				prepared return. The taxpayer(s) must declare the authenticity of the
				electronic return before it is transmitted. If the ERO makes changes to the
				electronic return after the Declaration for e-File Return form has been signed
				by the taxpayer(s), a new Declaration for e-File Return form must be completed
				and signed by the taxpayer(s) before the return is transmitted.
b. Electronic signature via remote
				transaction. In lieu of in-person handwritten signatures, a paid preparer, at
				the discretion of the taxpayer, may collect taxpayers' electronic signatures
				remotely by a process using identity verification and audit trail in the manner
				that the IRS allows for Form 8879.
c. Electronic signature via in-person
				transaction. Before a taxpayer electronically signs a Declaration for e-File
				Return form in which the ERO is physically present with the taxpayer, the ERO
				must validate the taxpayer's identity unless there is a multiyear business
				relationship. A multiyear business relationship is one in which the ERO has
				originated returns for the taxpayer for a prior tax year and has identified the
				taxpayer using a valid government picture identification and the method in
				paragraph 8.5(2)
"b."
For in-person transactions, identity
				verification through a record check is optional.
d. The ERO must provide the taxpayer with a
				copy of all information to be filed. The taxpayer and ERO must retain all tax
				documentation for three years. The Declaration for e-File Return form and
				accompanying schedules are to be furnished to the department only when
				specifically requested.