The Ledger: IRS Accounts, Who Needs Them, and How to Sign Up

Rick Oelerich, LPA, EA
Senior Tax Manager

In the past the IRS has been a call us or stop in to our office type of governmental agency. To receive and provide information their primary delivery method was the fax machine. Those days are coming to a close as the IRS is attempting to have taxpayers rely on the phone call and/or office visit. The IRS can be considered a financial services agency much like your bank or credit card company. In the future the IRS expects to address taxpayer needs by self-service online tools such as the IRS Individual Online Account or the Business Tax Account. We will focus on the Individual Online Account at this time. In the next quarter with a later article and video which will address the specifics of the Business Tax Account.

Calling the IRS (currently the preferred method of contact) is mostly going to disappear. While it will still be possible in the future to call or write the IRS the staffing at the IRS will make these types of communications increasingly cumbersome and difficult. IRS’s vision for 1040 taxpayers is that 90% to 95% of those individuals will address their issues with the agency using the Individual Online Account. These percentages closely mirror the number of taxpayers who e-file their returns. By opening an IRS Individual Online Account, the taxpayer can:

• View your tax account information: See your current balance, payments, tax return details, and account history.
• Make payments online: Pay your taxes directly from your bank account, by debit card, or by credit card. You can also view pending and completed payments.
• Access tax records: Download or view tax transcripts, which are often needed for mortgages, student aid, or loan applications.
• View notices: See IRS notices and letters sent to you electronically.
• Manage payment plans: Apply for, review, or modify an installment agreement if you owe taxes.
• Check refunds and balances: See refunds, what you owe, when payments are due, and whether your account is in good standing.
• Retrieve key tax information: View information such as your adjusted gross income (AGI) from prior years, which can help when electronically filing a new return.
• Manage your profile: Update certain account preferences, including language preferences and communication options where available.
• Enhanced security: Your account is protected by identity verification and multi-factor authentication to help safeguard your tax information.
• Manage your IP PIN: The Identity Protection Personal Identification Number, can be used to protect your tax filing identity. Most facets of managing that six digit number can be addressed using the Individual Online Account.

To create an Individual Online Account, visit irs.gov/payments/online-account-for-individuals. The IRS uses a secure identity verification process (ID.ME), so you will typically need your Social Security number or ITIN, a government-issued photo ID, and a device that can receive multi-factor authentication codes.