Newbie to E-File

[nycCPA]

Hi all,

I am in the beginning stages of starting my own side practice. I was just accepted by the IRS for E-File and was given an EFIN. I have a few questions:

1. I just want to confirm that all I need is an EFIN. I have ATX and I believe that is all I need to transmit returns.

2. Can I E-file returns that I do not sign as a paid preparer? There are certain family members and friends for which I do their returns for free.

3. What is the process I need to to and records that I must keep when e-filing a return. Is there anything else other than the authozation forms? Also, do authorization forms get e-filed as well or just kept for records?

4. I detest Refund Anticipation Loans based on what I understand of the economics however, I would not want to lose a potential client because of this. Is there anyone out there who does this? What is the revenue structure and how does it work exactly?

Thanks!
David

[BOB W]

Hi all,

I am in the beginning stages of starting my own side practice. I was just accepted by the IRS for E-File and was given an EFIN. I have a few questions:

1. I just want to confirm that all I need is an EFIN. I have ATX and I believe that is all I need to transmit returns. THAT IS CORRECT

2. Can I E-file returns that I do not sign as a paid preparer? There are certain family members and friends for which I do their returns for free. I DO

3. What is the process I need to to and records that I must keep when e-filing a return. Is there anything else other than the authozation forms? NO > JUST THE USUAL COPY OF THE TAX RETURN.

Also, do authorization forms get e-filed as well or just kept for records? JUST KEPT FOR YOUR RECORDS

4. I detest Refund Anticipation Loans based on what I understand of the economics however, I would not want to lose a potential client because of this. Is there anyone out there who does this? What is the revenue structure and how does it work exactly?

Thanks!
David

In addition you should read the E-file booklet supplied so that you enter all required info as you data-enter the clients info.

[taxmandan]

Efile

1. I just want to confirm that all I need is an EFIN. I have ATX and I believe that is all I need to transmit returns.

+++ Check with your state to see if they require a seperate registration and state ID number. Most states don't require anything more than the federal EFIN, but there are always some that cling to their own processes.

2. Can I E-file returns that I do not sign as a paid preparer? There are certain family members and friends for which I do their returns for free.

+++Yes, most software programs can be identified as 'self-prepared' in lieu of a paid preparer. But, my state doesn't say 'Paid Preparer' it asks for the Preparer other then the taxpayer, so whether I'm paid or not is moot. I just list as preparer on any return whether or not I'm paid or it's a freebee.

3. What is the process I need to to and records that I must keep when e-filing a return. Is there anything else other than the authozation forms? Also, do authorization forms get e-filed as well or just kept for records?

+++ Keep copies of the income source documents, W-2s, 1099MISC, etc. especially if there was withholding for income tax. You keep the form 8879, it is not efiled or mailed to the IRS, I believe it is for 3 years now. Some states have longer periods for retention of the authorization forms, again check you state rules.

4. I detest Refund Anticipation Loans based on what I understand of the economics however, I would not want to lose a potential client because of this. Is there anyone out there who does this? What is the revenue structure and how does it work exactly?

+++ We offer the Loans, don't promote them and only about 5% of our clients get one. The more important thing bank product is the ability to have our prep fee paid from the clients refund. It's not a loan, but we do alot of those type of things early in the season, and never have any delinquent accounts receivables now. And that is part of the RAL program from the bank, I highly recommend that, it really helps the client and you to get your fees paid.

[fliszt]

The above

answers most of your questions, so I'll just tell you that I efile 100% of my returns. Some clients are piggyback and some are not, but they are still efiled.
I do not offer RAL since I feel it is not in the client's interest. Efiled returns, direct deposts (95% of my client do direct deposits) will show up in the client's bank account within 10-15 days from time of acceptance. I am very "client oriented" and will not do anything for them which I would not do for myself. The young single mother's are the ones that I explain the costs of RAL versus IRS direct deposit. I may get myself in a jam for saying this, but if any of the kids need the money "tomorrow", I'll give them the money myself. No strings. period.
I've never been burned either. I hand select my clients and now at my age, everyone of them are my friends.
Larry