W-2 Verification Code

[BLACK BART]

I'm seeing a box that says "Verification Code" on some W-2s (but not all).  It's located just under boxes 10-11 and it's four blocks of four numbers each separated by a dash.  The ATX software has a place to enter this but not all the W-2s we've received have the code.  This is new to me -  didn't see it last year.  We are entering it, but have sent efiles for clients whose W-2 had no such number and IRS did not kick it back.  But anyway I'm wondering if it's related to ID theft; or if not, then what's the purpose? Any knowledgeable folks clued into this?

[jklcpa]

Yes, it's a pilot program between the IRS and several payroll companies to combat identity theft.

https://tax.thomsonreuters.com/media-resources/news-media-resources/checkpoint-news/daily-newsstand/irs-continuing-to-expand-w-2-verification-code-program/

 

[Catherine]

I've seen in the corporate returns (Drake) a new "return verification" section that requires last year's taxable income and some other info.  I've never seen that before, either, and again it's a new "prove who you are" section but geezles for corporations?  Is there something similar in ATX this year or did Drake just luck out on getting this pilot program?

[Lee B]

Yes, ATX has the same thing.

[BLACK BART]

9 hours ago, jklcpa said:

Yes, it's a pilot program between the IRS and several payroll companies to combat identity theft...

Okay, thanks.  I should've done a net-check before asking, but have to keep reminding myself that everything's online nowadays. That's a carryover outlook/habit/fault which was nurtured during the era of encyclopedias (every good middle-classer had to have a set).

Just a note on this VC pilot program; here's a quote from an affected company: "...this helps IRS validate that the return is real, but don't worry - the IRS assures us that returns with omitted and incorrect W-2 verification will not delay the processing of a tax return." 

I understand the program's just beginning and the VC is omitted on some returns, but for those that do include a number doesn't it sort of...um...uh...nullify the program's whole purpose if incorrect numbers are disregarded?

[Don in Upstate NY]

>I understand the program's just beginning and the VC is omitted on some returns, but for those that do include a number doesn't it sort of...um...uh...nullify the program's whole purpose if incorrect numbers are disregarded? <

Maybe the objective is to see if the number could be used to detect problems - if they don't get enough mismatches it probably isn't cost effective to deploy the checking on a production basis.

[Lion EA]

You can subscribe to IRS e-Newsletters &/or read the email updates from your tax software company &/or attend a tax update class each December/January &/or experiment with your new software each December to see what's changed.  This is year two, and more large payroll companies and large employers are required to participate this year than last year.

[BulldogTom]

Notice also (in ATX) that on your business returns there is an authorized signer sheet that pops into the return.  There is a lot of information on that sheet.  ATX says will not be needed this year except for the name and address.  I think they are going to tighten up and make everyone prove who they are when they sign a return in future years.

Tom
Newark, CA

[Catherine]

4 hours ago, BulldogTom said:

 ATX says will not be needed this year except for the name and address.

I saw something similar.  Last year they asked for ssn's for the signer; this year they are asking for ssn's, address, phone number.... it's just a matter of time before they start requiring blood samples, it seems.  At which point, we'll not only be unpaid auditors but also unpaid phlebotomists!  Then we can get a class-action suit against the IRS to pay us for all this unpaid work, claim the back pay, plus benefits and gov't pensions....  ok; I'll stop daydreaming now.

[Lion EA]

I get woozy when I see blood.  Can I take a cheek swab from my clients instead?

[jklcpa]

Hair samples for DNA and test the children too. That will be the required documentation for the 8867! 

[Lion EA]

From CCH's e-Newsletter last week:

• Partnership, Corporation, S Corporation, Fiduciary, Exempt Organization
  • Officer ID - State requirements for electronic filing most state returns now stipulate the inclusion of an ID for the return signing officer. This ID is the social security number for the signing officer. States also allow for the federal employer identification number as an ID for the signing officer, if applicable.

  • Number of W-2s - State requirements for electronically filing returns require the number of W-2s associated with any deduction for salaries and wages to be included for electronic filing purposes. All Fiduciary returns, Federal, California, Florida, Michigan, and Texas returns are not requiring this information and can be electronically filed without the number of W-2s present.  

Notes:  

• • If this information is not provided, your return will not qualify for export.

  • The following states do not require the signing officer ID or the number of W-2s:
    • California

    • Florida

    • Michigan

    • Texas

[Jack from Ohio]

It is my decided and experienced professional opinion that:

"Any deadlines or enforcement practices threatened by the IRS are a TOTAL comedy show."

Anyone with evidence to the contrary, please post it here.