IRS Announces Plan to Require Secure Access Registration to Use e-Services, Follows Up with Indefinite Delay

The IRS looked to expand their “Secure Access” to e-Services used by tax professionals, but on October 14 the agency announced an indefinite delay in implementing that requirement.  The announcement of the delay did not provide any details on when the program would begin operations or what changes, if any, might be made to the program.

On September 22 the IRS announced it was going to expand the secure access program to cover access to e-Services (Questions and Answers Related to e-Services Migration to Secure Access).  However, as has been discussed regarding the roll-out of this program to other services (like the online transcript system), there is a far from insignificant number of individuals who generally cannot complete the process online.

Some of problems will include the requirement to use a post-paid wireless phone listed in the name of the applicant to use the simplest authentication via receipt of text messages on the phone.  As well, the new system will require that the user have a wireless phone that receives text messages in order to be able to log in after setting up the account under the new system.

Advisers unable to use the simplest systems could need to wait to receive a code via U.S. Mail delivery to their home, be required to call the IRS to attempt to authenticate or, in the worst case, have to visit a Taxpayer Assistance Center to present identification in person—obviously far from optimal solutions if the adviser makes regular use of e-services in his/her practice.

A number of practitioners complained that the short period from announcement to implementation (the system was scheduled to roll out on October 24, just over a month after the announcement) coupled with a number of approaching deadlines and the practical problems related to loss of access meant the IRS needed to rethink the matter.

For now the IRS has backed off the authentication requirements.  However, it seems likely the IRS, concerned about unauthorized parties taking over or creating e-Services accounts, is going to eventually move forward on this issue.  Advisers need to watch for further IRS information related to these changes in the future.