2005 Electronic Filing Mandates for Federal 1120, 1120S, and 990 Returns

For tax year 2005, the IRS requires corporations with total assets of at least $50 million and tax exempt entities with assets of at least $100 million to file their returns electronically. For tax year 2006, this threshold will drop to a minimum of $10 million in assets. Additionally, private foundations and charitable trusts will be required to e-file their Form 990PF, regardless of their asset size. This e-file requirement only applies to entities that file at least 250 returns annually, including income tax, excise tax, information (W-2, 1099, etc.), and employment tax returns.

By 2007, the IRS expects that more than 20,000 large corporate taxpayers and up to 10,000 tax-exempt entities will be affected by this e-file mandate. In tax year 2004, over 200,000 corporations filed their returns electronically before any mandates became effective. Drake Software customers filed more than 15 percent of these returns.

From December 2005

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