In a Quick Alert posted on June 15th, the IRS announced that it is pushing forward with its implementation of the new Information Returns Application for Transmitter Control Code (IR-TCC) standard for the FIRE System. This development is critical for existing FIRE system filers as these users will need to re-apply for a TCC using the new IR-TCC application system. It is important to note that filers that have received their TCCs before September 26, 2021 MUST take action to keep their existing TCCs active.
A Brief History
The IRS introduced Phase 1 of the IR-TCC application transition process in September 2021. This new application replaced the old paper and form fillable PDF versions of Form 4419 (Application for Filing Information Returns Electronically) to help automate the application process.
Part of the Phase 1 implementation also required that new FIRE users must authenticate their identity using the Secure Access system. This process required much more information from users than a standard IRS E-Services account including information about users’ credit cards, mortgages, and forcing the use of two factor authentication using a mobile device.
What is the FIRE System?
Filing Information Returns Electronically (FIRE) is the online tool/system that is used to transmit information returns and automatic extension requests to the IRS. This system is used primarily for sending 1099s (like 1099-DIV, 1099-INT, 1099-MISC, 1099-NEC and others) to the IRS. This system is also used for filing automatic extensions for most 1099 form types.
What is the IR-TCC?
IR-TCC is a new TCC application process that has been designed from the ground up to be more secure and is much more automated than previous mailable / form fillable application processes.
Part of this system will require new users to authenticate their identities using a rigorous new process if they do not already have a Secure Access username and password.
What are the benefits of the IR-TCC?
The new online application has many key benefits including:
- TCC application automation for users
- Fast TCC application processing
- Users will be able to manage their application, add and remove authorized users, view their TCC, and request additional TCCs.
- The new platform will allow for increased user support. E-Services user counts are projected to increase due to proposed regulations to reduce e-file requirements from the current 250-form threshold (cumulative form count across all form types) in the coming years.
What is required for an IR-TCC Application?
To create an IR-TCC Application, users will need the following:
- Legal Business Name and Employer Identification Number (EIN)
- Business location and mailing address
- Business Structure (Corporation, LLC, Sole Proprietor, etc.)
- Contact phone number
- Form types that will be filed electronically. Please note that users should only select the form types that they KNOW they will be filing electronically.
- Authorized Users – This should include their name, Social Security Number (SSN) or Taxpayer Identification Number (TIN), title, phone number, and date of birth for each authorized user.
What’s next for the IR-TCC transition?
Phase 2 is set to begin in September 2022. This means that FIRE users who submitted their TCC applications before September 26, 2021, must complete the online IR-TCC Application to keep their TCC. The IRS reports that this can be done anytime between September 2022 and August 1, 2023.
Those with old TCCs will be able to continue to use them until August 1, 2023. After that date, all users with FIRE TCCs that did not complete an IR-TCC Application will become inactive and users will not be able to e-file using that TCC.
Want to know more about the IRS FIRE System? Check out our IRS FIRE System Guide!
BoomTax, The Boom Post, and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors prior to engaging in any transaction.