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CCH Axcess Tax

Federal Electronic Filing Information

Introduction

Electronic filing offers numerous benefits to the taxpayer and preparer. Some of these benefits include: less paper handling; reduced costs; improved accuracy and product quality (fewer errors, therefore, less correspondence with IRS); electronic acknowledgment of return. The IRS has stated that electronic filing continues to be the future of tax processing data delivery methods. With CCH Axcess Tax you can participate in that future immediately.

This section provides information on the electronic filing process.

IRS Publication 1437, "PROCEDURES FOR THE 1041 e-file PROGRAM" should be thoroughly reviewed before any return is processed for electronic filing through CCH Axcess Tax. TY2014 will allow only MeF(XML) e-Filing for 1041 returns.

Electronic Filing Procedural Steps - Overview

1. Enter your Electronic Filing Identification Number (EFIN) through the the Return Configuration Set in the Electronic Filing Options dialog if it hasn't been done already. To access the dialog, see the Entering Your EFIN section of this document.
2. Use the Electronic Filing worksheet in Tax Preparation to designate a return for electronic filing and then complete the return. Electronic filing may also be selected on a global basis by making an entry in the Electronic Filing Options dialog through the the Return Configuration Set.
3. While in CCH Axcess, calculate the completed return, then select File/Export/Electronic Filing to create the IRS file and print the fileable copy of Form 8453-FE or 8879-F. Review the form for accuracy and completeness and secure all necessary signatures.
4. Authorize (release) the return(s) for transmission to the IRS, if you did not already do so on the upload process through CCH Axcess. Authorizing the release through Tax Preparation or through the Electronic Filing Status system will immediately send the return to CCH Tax and Accounting for transmission to the IRS.
5. Check the status of the return in the Electronic Filing Status system. If the return has been rejected, make the necessary corrections and reprocess the return.

Electronic Filing Procedural Steps

Review the following basic rules for submitting a return for electronic filing:

MeF 1041 e-File does allow amended as well as prior year returns.

The worksheet or forms you use to designate a return for electronic filing are located on the Electronic Filing worksheet.

Configure Electronic Filing

Entering Your EFIN

1. In the the Return Configuration Set, click Configure Applications.
2. Highlight Tax Preparation and click Configure.
3. Select the office group return configuration set with the clients for whom you want to perform electronic filing and click OK. The Configure Tax Preparation dialog displays.
4. Highlight Electronic Filing Options and click Setup. The Electronic Filing Options dialog displays. Enter your EFIN in the ID number box. This option can also be set on General > Electronic Filing > General.
5. Click OK when finished.

Designating a Return for Electronic Filing

When keying a return, you must designate that you want to electronically file the return. This can be done using one of the following methods:

Make any entry on General > Electronic Filing > General.

To globally select all returns for electronic filing, select the Electronic Filing Options section in the Configure\Tax Preparation dialog in the Return Configuration Set.

Once you key a return and calculate it, the return is run through diagnostics to determine its eligibility for electronic filing. This process is explained below.

Calculating and Creating the Electronic Return File

Once you designate a return for electronic filing and complete data entry on the return, complete the following steps to create the IRS file.

1. In Tax Preparation, select Calc to calculate the return. During this step, the return is validated through diagnostics to determine its eligibility for electronic filing.
2. Examine the diagnostics to ensure that the return qualifies for electronic filing. If the return does not qualify, check the diagnostics to determine the reason(s) for disqualification (see the Electronic Filing Diagnostic Report section for details). If the return qualifies for electronic filing after completing the calculation, create the IRS file (Export the return) and print the fileable copy of Form 8453-FE or Form 8879-F in the next step.
3. After the calc completes successfully, select File/Export/Electronic Filing. An IRS-formatted file is created and a fileable Form 8453-FE or Form 8879-F will print. After exporting, the Upload Returns dialog displays. You will then have the option to Upload and hold the return or Upload and release to taxing authority.

Electronic Filing Diagnostic Report

You can display or print a diagnostic report detailing why the return was disqualified. See the Return Eligibility section for more information.

To view or print the diagnostic report:

1. In Tax Preparation, select File/Print/Preparer Reports.
2. Choose Diagnostics.
3. If you want to view the report, click the View Report button and click OK. Otherwise, just click OK. The diagnostics indicate whether or not the return qualified for electronic filing. If the return did not qualify, the reason is included in the level 4 diagnostics. The level 4 diagnostics print or display at the top/first of the diagnostic report. You can reprocess the return with the appropriate corrections, or if necessary, file a paper return.
4. Click Close to close the Diagnostics dialog.

5. Select File/Exit to exit Tax Preparation. Answer Yes to the prompt to save your changes. Use the Electronic Filing Status system application to select the returns you wish to send to the service center for transmittal to the IRS.

Authorizing (Release) Returns to Send to the Center

Once you determine the return is ready to send to the IRS, you can either release the return(s) through Tax Preparation using the upload and release to taxing authority feature or release the return(s) through the Electronic Filing Status system. You select the return(s) you want released and they will automatically be transmitted to CCH to be released to the taxing authority.

Transmitting Returns to CCH Tax and Accounting and the Taxing Authorities

1. The return must first be uploaded to the Electronic Filing Status system.
2. Log in to the Electronic Filing Status system.
3. Click the Release Returns tab. Only returns with a current status of "Ready to Transmit" will be listed on the tab.

4. Search for returns to release using one of the following methods:
   • To search for multiple clients, select the filtering options from the drop-down lists and click Filter.
   • To search for a single client, use the Specific Client by section and select an option to search by. Example options are Return ID, Name (Last, First), or EIN. Enter the search term in the text box and click Search.
   • The results of your search will display in the bottom section of the screen.
5. Select returns to release using one of the following methods:
   • Select the check box next to return.
   • Click Select All Displayed to choose all of the returns displayed on the page.
   • Click De-Select All Displayed to de-select all of the returns displayed on the page.
6. Click Release to Taxing Authorities to immediately send the returns to CCH for transmission to the IRS.
7. Click OK on the confirmation dialog. The selected returns will be released to the taxing authorities.
8. Select the e-filing status tab to view the status of your e-filed returns.

Returns Accepted for Electronic Filing

IRS acceptance of the electronic return indicates that the electronic filing process was successful and the return, in all probability, will be processed as expected. An IRS acceptance acknowledgment will usually be issued from 24 to 48 hours after sending the return.

Form 8453-FE or Form 8879-F - Signature Documents

The IRS requires that you do the following to avoid facing penalties and/or suspension from the electronic filing program:

• Maintain copies of all Forms 8453-FE or Form 8879-F.
• Ensure all Forms 8453-FE or Form 8879-F are fully and correctly completed.
• Ensure all appropriate attachments are included.
• Make sure the forms are stored ( 8453-FE and Form 8879-F) in the event the IRS requests them.

Receiving Refunds

Certain liability conditions may cause a refund to be offset after the return has been accepted. As part of the acknowledgment file received from the IRS, an indicator that a debt exists will be made. The IRS will also contact the taxpayer in writing concerning the type of debt. The following are the types of debts that may cause the IRS to offset (reduce) the refund:

• Delinquent federal tax.
• Delinquent state tax.
• Delinquent student loan.
• Delinquent child support.
• Back payments owed to other states and/or federal agencies.

If the taxpayer does not receive their refund within four weeks of the date of acceptance, they should call 1-866-255-0654.

Because of disclosure laws, the IRS cannot provide information through CCH Axcess Tax regarding refund delays. Likewise, the IRS cannot provide this information to the practitioner unless a current power of attorney is on file at the IRS.

Balance Due Returns

For balance due returns filed electronically, the fiduciary must sign the Jurat on Form 8453-FE or Form 8879-F.

Electronic Funds Withdrawal is available to pay a balance due for electronically filed returns. The following form is used to make the necessary entries to use direct debit:

• General > Electronic Filing > Direct Deposit/Electronic Funds Withdrawal section.

Electronic Filing Status System

The Electronic Filing Status system maintains a record of all your electronic returns. If the IRS has rejected a return, you must determine the reason, then resubmit the return or file a paper return.

To check the status of your returns:

1. Log in to the Electronic Filing Status system.
2. Search for returns by using the Filter or Search option.
3. Review the e-filing status in the ELF Return Status Information section.

Federal Status and State Status conditions can be:

• Ready to Release. The return is ready to be released for transmission to the IRS.
• Released for Transmission. The return has been released by the tax preparer and is ready to be transmitted to the IRS but has not yet been transmitted.
• Transmitted. The return has been transmitted but no acknowledgment has been received from the IRS.
• Accepted. The IRS has accepted the return for processing.
• Conditional Acceptance. The state has conditionally accepted the return for processing. The state will send an acceptance acknowledgment at a later date. The preparer should not retransmit the return.
• Rejected. The return has been rejected for processing by the IRS. You should check to determine the reason for the rejection and resubmit the return electronically or file by paper.
• Stop. If you have stopped transmission of this return on the Change Status tab, this status will display.
• Paper Filed. If a return was rejected and is now going to be paper filed, the status can be changed to Paper Filed from within the Rejection Report.
• Return History/Batch Print. This can be used to display the Return History for a single client or for multiple clients. The Return History displays a complete report of the actions taken on a client return. When the Return History option is selected, the screen displays:
  • A detailed report for all activity done on the client's return.
  • The date on which each action took place.
  • An option to print the history report for that client's return.
  • State acknowledgment information.
  • The amount of the refund or balance due.
  • The debt indicator, if applicable.
  • The electronic postmark received from the IRS.
  • The direct debit acceptance indicator.
  • The method of acceptance notification.

Viewing the Rejected Returns Report

Rejected returns are returns rejected for processing by the IRS. A rejected return ordinarily indicates a problem in the content of the return. CCH Axcess Tax users are responsible for tracking and resolving problems, and resubmitting the return electronically or by paper.

If a rejection is related to a transmission problem, CCH Axcess Tax will retransmit the data until a successful transmission is achieved.

To view the Rejection Report for a return, do the following:

1. Log in to the Electronic Filing Status system.
2. Search for returns using the Filter or Search option.
3. Click the Rejected link in the row of the return, or if there are multiple states, hover over the Multi link and click the Rejected link in the pop-up window. The Rejection Report dialog will display.
4. Do one of the following:
   • Click Print to print the Rejection Report.
   • Click Export to export the Rejection Report to a .CSV file.
   • Click Change status to paper filed to mail the return instead of filing electronically.
   • Click the X in the upper right corner of the dialog to return to the Electronic Filing Status system.

Other Electronic Filing Information

Retransmissions

To retransmit electronic returns, simply repeat the electronic filing procedural steps.

The electronic file for all applicable states is created (through the Export function) simultaneously or without the federal.

Third Party Processing Option

This option is available to allow electronic returns created within CCH Axcess Tax to be transmitted through a third party other than CCH Axcess Tax. The entry for this option can be found in the Return Configuration Set, on the Electronic Filing > General. When this option is selected, the IRS file is created with an extension of "IRS" and will reside in a subdirectory called "IRS" of the WFX32\CLIENT\17F\ directory. The IRS file can then be processed through the third party software. This option is not available for Global fx.

Return Eligibility

Electronically filed returns are limited to a certain number of IRS forms and schedules. The forms and schedules available through CCH Axcess Tax for MeF(XML) electronic filing are:

Ineligible Return Conditions

In addition to the forms and schedules that are not listed above, the following situations will also make the return ineligible for electronic filing:

• Returns with a power of attorney (POA) attached and the IRS does not currently have a POA on file.

In addition to the IRS return eligibility limitations, CCH Axcess Tax has the following additional limitations for electronically filed returns:

• Manually calculated forms and schedules will disqualify a return. All of the information in the return must be generated through the CCH Axcess Tax program in order to file a correct return with the IRS.

Common Questions Asked by Electronic Filing Participants

Acknowledgment Questions

Q. I released a return for transmission to the IRS yesterday and I have not received my acknowledgment back. When can I expect to receive it?

A. The IRS advises that acknowledgments should be received within 24 to 48 hours. Normally they are back within 24 hours, but we do need to allow up to 48 hours before contacting them. If you have not received an acknowledgment within 48 hours and your Electronic Filing Status system is showing Transmitted, please call the Electronic Filing staff at 1-800-739-9998.

General Questions

Q. Who is the Electronic Return Originator (ERO)?

A. The person or firm who collects the actual return from the taxpayer for the purpose of electronically filing it with the IRS is considered to be the ERO. If you are preparing the return and submitting it for electronic filing, then you are the ERO.

Q. I have received the acknowledgment indicating that my return has been accepted, but I have a correction to make to the return. Can I call the change to the IRS?

A. No. Once the return has been accepted by the IRS for processing you cannot change the electronic return. You must file an amended return. The amended return cannot be sent electronically.

Q. I printed the paper copy of my return and Form 8453-FE or Form 8879-F was included, but why does it have "This is Not a Fileable Copy" across the form?

A. The Form 8453-FE and Form 8879-F that prints with the message "This is Not a Fileable Copy" is for your review only. When the File/Export/Electronic Filing step is executed to create the electronic return and print the fileable Form 8453-FE or Form 8879-F, this message is removed. This is the form you will be filing with the IRS.

After creating the electronic version of the return, a fileable Form 8453-FE/8879-F can also be printed through File/Print/Selective Pages and selecting Form 8453-FE or Form 8879-F. If the return is recalculated, the nonfileable message reappears on Form 8453-FE/8879-F until the electronic return is once again created.

Q. I have processed a return and it is ready to file, except I did not select electronic filing. How do I add electronic filing to a return that has already been processed?

A. The only way to add electronic filing to a return already processed is to reprocess it with Interview Form EF-1 information included.

Q. I unintentionally transmitted a return to CCH Axcess Tax. Now what do I do?

A. If the return has already been sent to the IRS, we will have to wait to see if the IRS accepts it. If it is accepted there is nothing more that can be done. At this point you may want to contact the IRS or file an amended return. If the return is rejected, it is not considered a filed return.

Rejection Questions

Q. One of my returns rejected and I have to re-run it for corrections. When I reprocess I will receive a new Form 8453-FE/8879-F. Does the taxpayer have to sign the new Form 8453-FE?

A. Probably Not. Because most returns rejected can be corrected with a nonsubstantive change, you can mail the original Form 8453-FE to the IRS. If the change to the return was substantial, according to Pub. 1345 rules, the taxpayer must sign a new Form 8453-FE.

Q. My return rejected on the due date. Is it considered a late-filed return now?

A. Returns rejected on the due date have until midnight on the thenth business day after the due date to be accepted. If the return has not been accepted by this time, you should file a paper return. With the paper return, include a note to the IRS explaining the return was filed by the due date, but rejected.