Understanding Electronic Signature Legality for Payroll Deduction Authorization in the United States

How to eSign a document: electronic signature legality for Payroll Deduction Authorization in United States

over IRS form 8879 IRS e-file signature authorization so this is the authorization form that you might see from your tax preparer or your accountant this is the the form that allows you to e-sign tax returns that your CPA prepares instead of signing them in person so this is a one-page document and and the purpose of this video is really to help you better understand what it is that you're going to be asked to do so the form itself that you send to the IRS is one page the document is two pages and then on the second page are all the instructions that apply to this form so since we're in the instructions as a as I said the purpose of the form is to uh allow a tax practitioner to use a pin method to to generate the personal ID number for you to sign your tax return so part of this allows the tax prepared to prepare your tax return and then send it to you you type in your pin and then that acts as your signature and then there's a list of responsibilities that your tax preparer must have to to either properly generate your information properly Safeguard it and then there's a list of responsibilities that you as a taxpayer uh have so realistically there are a couple of important notes don't send the form to the IRS unless you're specifically requested to do so but this is really for the tax practitioner tax practitioners should retain the completed form for at least three years from the tax return date this is all part of helping you understand what happens to this form after you've completed it so those are all instructions that you can read that tell your tax preparer what to do with this document how to safeguard it and how long to retain your paperwork just for your information so on to the tax form itself so at the top is a submission identification number this is generally automatically prepared by by the tax practitioner you don't need to worry about that but uh right below it is your name social security number and if you're filing a joint tax return then your spouse's name spouse's social security number this will all be pre-generated so just ensure that it's accurate on the part one part of this tax return this is the kind of a summary of the tax return that you're about to file so line one is the adjusted gross income line two is the total tax line three is the federal tax withheld either from your W-2 or your 1099 line four is the amount that you want refunded to you and then the line five is the amount that you owe so you're going to see either or probably not both and this is for the tax year so you know we're in 2023 this should look like the tax year ending December 31st 2022 and then this form would be for the 2022 tax year part two is the taxpayer declaration and signature authorization so one of the things that this form tells you is you should have your own 88.79 for your records as the taxpayer as well as the uh electronic return original originator or ero as your tax preparer is officially recognized by the IRS so if you know there's this taxpayers pin and then if you're filing jointly with a spouse uh an identical field for your spouse and you'll check one box uh only so you can either authorize whatever the tax preparation firm's name is to enter or generate your pen which is a number that you can enter and up to five digits as long as they're not all zeros or you can select the option to enter your own pin as as if it were your signature on the tax return so you you'll check this box only if you're going to enter your on pin and your tax return is being filed using the practitioner pin method and then there's a part three that we'll get to that talks about what your ero would complete in order to make that happen so whichever method you choose whichever method your spouse chooses you're going to sign a date the applicable fields this is the practitioner method the part three so um you would only use this and and basically uh filling out the efin which is a six digit number followed by the five digit self-selected PIN and then your tax preparers signature and is signed and dated at the bottom of the document so couple of things to go over just for your edification so that the instructions do contain a little bit more information about the 20 digit submission identification number which is the number that was at the top of the form and uh there are a couple of ways to generate that number the instructions talk a little bit more about that this is really guidance for your tax practitioner your ero so this is not you know this is something that your ero would generate for you um and then like I said you can go through the rest of this and uh to better understand it if you would like we've written an entire article about this uh this form you can go to our website teach me personal finance.com type in IRS form 8879 in the search bar and select the article I hope you enjoyed this if you have any questions please hit us up on social or send us an email you can reach us at Forest at TeachMe personal finance.com and until next time thank you