Tax Tips : IRS online account and its benefits

 IRS Online Account 

Taxpayers can access and view their IRS tax information through their personal online account at any time. When filing their tax returns or following up on outstanding accounts or notices, they can view pertinent information. This white paper will provide answers to the following questions.

1. Why should I create an online IRS account?
2. What do I need to register for an online IRS Online account?
3. What are steps to set up your IRS account
4. What is ID me?
5. Can I create an IRS online account for business?

Why should I create an online IRS account?

The biggest reason to create an IRS account is to quickly look up your personal tax data. Once registered, you can access a wide array of your tax information, including:

1. Your adjusted gross income
2. Details of your latest tax return
3. Payment history for past five years
4. Amount of taxes currently owed
5. Economic impact payment amounts
6. Advance child tax credit payment amounts
7. Digital versions of some IRS notices
8. Tax professional authorizations

Along with viewing your personal tax information, with an IRS online account, you can make payments online, go paperless for certain IRS notices and approve authorization requests from your tax professional.

You can get instant copies of tax records like transcripts of past tax returns and wage and income statements. With an online account, you can also request an Identity Protection PIN to add an extra layer of security to your tax records.

Tax experts advise creating an IRS online account just in case you run into a tax issue or problem in the future. It's better to have an account already created than be forced to register online during the stress of a tax difficulty already in progress.

What do I need to register for an online IRS account?

If everything goes perfectly, it takes around 15 to 30 minutes to create an IRS account online. Before beginning the procedure, you will need to gather a few documents and pieces of information. Here's what you'll require:

1. A valid email address
2. Your postal address
3. A passport, passport card, or state driver's license issued by the United States
4. Your SSN or taxpayer identification number
5. A mobile phone associated with you

If you do not have a mobile phone or do not wish to link your number to your online IRS account, you can request an activation code by mail. The code will arrive in approximately 10 days and will be good for 30 days.

What steps do I take to set up my IRS online account?

The IRS provides multiple entry points for registration. The easiest method is to visit the IRS's Your Account online page. Click the blue "Sign in to your online account" button to begin the registration procedure.

Recently, the IRS added an interstitial page for online account management. About two minutes were required for a temporary loading page to redirect to the registration form.. 

Once the waiting page redirects, you will be directed to a screen requesting that you create an ID.me account. ID.me is a third-party identification service mandated for all new IRS accounts.

The ID.me registration should take approximately 15 minutes and requires images or scans of your identification documents — visit the ID.me website. Click the green button labeled "Create an account" to begin.

For a comprehensive explanation of the ID.me registration procedure, please refer to our ID.me tutorial. Here are the fundamental steps:

1. On the ID.me account creation page, enter your email address and choose a password.
2. Confirm your email address next.
3. Enable multifactor authentication on your mobile device.
4. Select an ID verification method: Self-Service using a "video selfie" or Video Chat with an ID.me representative.
5. Upload photographs of your ID.
6. Take and upload a "video selfie" or wait for a video chat interview for two hours.
7. Provide your Social Security number

Lastly, grant the IRS access to your ID.me verification.

After authorizing the IRS to access your ID.me information, your online IRS account should be active, and you should have access to all the information and capabilities the IRS offers.

What is ID.me?

ID.me is a third-party "identification verification" company that works with the Internal Revenue Service, the Social Security Administration, the Department of Veterans Affairs, and 27 state governments, largely for unemployment benefits.

The IRS began utilizing ID.me as a trial program for identity verification in 2017 and has now expanded it to cover all new accounts. Users of the IRS who created online accounts prior to the deployment of ID.me may continue to use existing accounts until the summer of 2022, when they will be required to register with ID.me. The IRS has not yet provided a date by which old accounts must be converted to ID.me.

Recent criticism has been leveled at ID.me and the IRS over the mandated video selfie, which is a needed registration step involving facial recognition technology. Politicians and advocacy organizations lobbied vehemently against the practice, stating that a private company should not gather biometric information on millions of Americans. Black and Asian faces have been proved to have a greater false positive rate when using facial recognition technologies.

The IRS announced a "transition away from usage of third-party verification employing facial recognition" on February 7 and stated that it would build a new identity verification approach that does not involve facial recognition.

Two weeks later, the agency announced that taxpayers enrolling for an IRS account would have the option of substituting the automatic facial recognition stage with a "video chat interview." The choice to employ a video selfie or a video chat interview is now made early on in the IRS account registration procedure (No. 4 in the listed steps above).

Can I create an online IRS account for my business?

The IRS has not yet enabled internet access to company accounts. According to its online account FAQ, the IRS "plans to build an online account for business taxpayers in the future, allowing businesses to manage their federal tax responsibilities quickly and securely."

Through the Electronic Federal Tax Payment System, business owners can currently make payments or schedule projected payments online.

Published initially on January 29, 2022, at 4:30 a.m. PT.