New Issues With E-Filing Tax Returns

I am continuing to discover the ins and outs of e-filing income tax returns. One issue that has come to my attention is the EFIN number, a number that is assigned to corporate and partnership taxpayers by the Internal Revenue Service. This is required to e-file Federal and State income tax returns.

For Federal Tax Purposes, corporate taxpayers that are affiliated with one another usually file under one company and combine each company's taxable income and pay tax based on the combined amount. When I worked for BellSouth Corporation, the federal return that was filed was "BellSouth Corporation and Subsidiaries," which made up many different companies.

For many states, particularly southern states and many northeastern states, companies file returns as separate entities - this means that groups of, say, 10 companies that filed 1 federal return would file up to 10 separate returns in states like Georgia or North Carolina if each company had business operations there.

The question I am having to answer if what EFIN to use for companies that e-file 1 combined Federal return under a common EFIN but must e-file separate state returns. Should the same EFIN number be used for each company? This would seem to be the case, but I guess I will find out for sure soon.

Filing Electronic Tax Returns

I currently am doing contract work for a large partnership based in Alpharetta that is owned by a US company and a British company. One initiative that is being pushed this year is for the state income tax group to file more state income tax returns electronically as opposed to the traditional way of mailing returns that the company prints from a computer after processing the return in tax software. A few states require companies filing partnership or corporate returns to file tax returns electronically, and management sees this trend as growing as time goes on.

I will be updating this blog as time goes on and share what states will be filed electronically as opposed to by mail, and I will discuss why I think states are looking to have corporate and partnership entities file returns electronically.

This Blog Is Up and Running

Good evening. Thank you for visiting my blog. This is my first official posting. More detail is to come in the future. The subject of the blog will center on Technology for 7 weeks or so, then the direction may or may not change.

Hope everyone has a good Tuesday, glad to see New Zealand got a tie out of their World Cup match today, hope Germany and Japan do well in their upcoming matches. A win for France in their next match would be nice, too.