Changes coming to tax transcript availability

The IRS said Tuesday that on June 28 it will stop faxing tax transcripts to taxpayers, tax professionals, and third parties to protect against identity theft (IR-2019-101). The IRS will also stop mailing tax transcripts to third parties. The new policy covers individuals and businesses.

Once this change goes in effect, individual taxpayers will be able to obtain their own tax transcripts, which are summaries of tax return information, by:

• Using IRS.gov or the IRS2Go app to access Get Transcript Online; taxpayers must first verify their identities but may then immediately download or print their transcript;
• Using IRS.gov or the IRS2Go app to access Get Transcript by Mail; the transcript will be delivered within 10 days to the address of record;
• Calling 800-908-9946 for an automated Get Transcript by Mail feature; or
• Submitting Form 4506-T, Request for Transcript of Tax Return, or 4506T-EZ, Short Form Request for Individual Tax Return Transcript, to have a transcript mailed to the taxpayer’s address of record.

Tax practitioners have several options to obtain taxpayers’ transcripts going forward for tax preparation or representation purposes, including having them mailed to the taxpayers’ addresses and obtaining masked transcripts that hide personally identifiable information using the e-Services Transcript Delivery System.

Beginning July 1, in another step to foil identity theft, Forms 4506, Request for Copy of Tax Return, 4506-T, and 4506T-EZ will not provide an option to have transcripts mailed to a third party. These requests are often made by lenders and others to allow them to verify income for nontax purposes. Going forward, those requests can be met by using the IRS’s Income Verification Express Service (IVES). Tax return information currently available through the IRS Data Retrieval Tool through the Free Application for Federal Student Aid (FAFSA) process will continue to be available after this change.

Because transcripts are masked by obscuring names and Social Security numbers, the IRS has set up a program to help third parties match transcripts to individual taxpayers. The IRS is permitting third parties to assign a Customer File Number, such as a loan application number or a student identification number. The number will populate on the transcript to help match it to the client or student.

— Sally P. Schreiber, J.D., (Sally.Schreiber@aicpa-cima.com) is a JofA senior editor.