TEI, IRS work to make corporate e-filing more administrable.

• Position: Recent Activities

Tax Executives Institute has raised concerns about the efficacy and the administrability of the Internal Revenue Service's corporate e-filing mandate since the IRS issued its mandate in mid-January. In liaison meetings, written comments, public testimony, and at the Institute's Midyear Conference, TEI has raised questions about the recent initiative to require certain large taxpayers to electronically file their 2005 income returns. (The temporary and proposed regulations were the subject of written and oral comments by the Institute in March.) TEI has also worked with the IRS to overcome the challenges and narrow the differences between what the IRS has mandated, what vendors can deliver, and what taxpayers should be required to do.

For example, in April, TEI met with IRS representatives to discuss what forms and attachments could be submitted in an Adobe Acrobat format and other potential ways of complying with the mandate. R. Don Blaicher of ExxonMobil Corporation, Frederick R. Holt of American Financial Group, Inc., and William J. Marx of General Motors Corporation, together with Eli J. Dicker, Mary Lou Fahey, and Jeffery P. Rasmussen of TEI's legal staff, explored the difficulties of requiring text data to be typed in a vendor's software and merging information from several sources into one XML file. TEI added that merging information from foreign affiliates into one file may present its own unique issues because many taxpayers keep such international data in a spreadsheet format. The Institute representatives stressed the lack of a software "aggregator" to merge the various sections of the return into one file--a problem that could prevent taxpayers using two forms of software from complying with the mandate.

Addressing concerns about verifying that an electronic return has been validly filed, the IRS stated at the April meeting that a "check sum" approach that would confirm the amount of data filed is under consideration.

At the request of the IRS, TEI subsequently submitted a list of 18 forms that are currently required to be filed separately from the return, such as...