CONTINUING EDUCATION FOR TAX & FINANCIAL PROFESSIONALS
Subscribe
Login
Main Menu
Main Menu
Account
Cart

IRS Expands Business Tax Account: What Tax Professionals Need to Know

Hurriedly spending its IRA22 money, the IRS is improving how businesses manage their tax information with significant enhancements to the Business Tax Account (BTA). This digital evolution represents a critical step forward in providing more accessible and user-friendly tax management tools for corporations and business owners.

Key Expansion Highlights

The most recent update (FS-2024-31) introduces several important changes:

  • Expanded access for C corporations
  • Introduction of Designated Officials (DOs) with full tax account access
  • New Income Verification Express Service (IVES)
  • Enhanced digital transcript and payment capabilities

Understanding Corporate Designated Officials

A Designated Official is not just any corporate employee, but a key executive with specific qualifications. These individuals must:

  • Be a current employee who received a W-2 from the corporation
  • Have legal authority to bind the organization
  • Represent critical corporate roles such as:
    • President
    • CEO
    • CFO
    • Secretary
    • Treasurer
    • LLC Managing Member

Who Can Access the Business Tax Account?

Current eligibility is carefully defined and includes:

  • Sole proprietors with an Employer Identification Number (EIN)
  • Individual partners or shareholders with a Schedule K-1
  • Corporate executives with binding corporate authority

Important Limitations To BTA Access

Tax Preparers and single-member LLCs cannot currently access the system, though IRS plans future expansions.

Preparing for Business Tax Account Registration

Tax professionals should guide clients through a careful preparation process. Clients will need to gather:

  • Social Security Number or Individual Taxpayer Identification Number
  • Employer Identification Number
  • Recent federal tax documents
  • Current business mailing address
  • Established ID.me profile

Income Verification Express Service (IVES)

The new IVES feature streamlines the lending process by allowing quick tax record verification for loans and enabling businesses to approve or reject transcript requests. IVES also provides a secure method for income authentication.

Practical Considerations for Tax Professionals

While the Business Tax Account offers numerous benefits, there are key points to remember:

  • Designated Officials must re-validate annually
  • Multiple DOs can enhance business access
  • Transcripts are available in English and Spanish

The Business Tax Account is more than just a new tool – it’s a glimpse into the future of digital tax management. By staying informed and proactively understanding these new features, tax professionals can provide more efficient, tech-savvy service to their business clients.