The Internal Revenue Service has recently introduced a new business tax account that is set to receive additional features next year, aiming to streamline tax processes for entrepreneurs. Some of the upcoming features will enable businesses to review their tax payment history, make payments, access notices, and enjoy similar benefits to those available in individual tax accounts. Currently, the business account is only accessible to solopreneurs and offers limited functionality. Users can verify their company name and address, as well as grant their accountant access to the account.
By 2024, the IRS plans to expand the business account to allow small-business owners to respond to numerous online notices. Even if not a solopreneur, business owners are encouraged to establish an account now to ensure that their filed information aligns with IRS records. This proactive approach will prepare them for the forthcoming features.
To create a business tax account, individuals will need an employer identification number (EIN), which can be obtained online. During the account setup, users will be required to answer security questions and verify their identity with a photo ID. According to industry experts, this process should take no more than 15 minutes with the necessary information readily available.
This new business account is expected to significantly reduce the time spent on tax-related research for entrepreneurs. For instance, it will allow business owners to verify if they have received a 1099 form from another entity. Additionally, the account aims to simplify communication with the IRS, potentially minimizing delays in addressing penalty notices or resolving errors.
Once fully established, the business tax account is anticipated to streamline tax-related procedures, automate various tasks, and thereby reduce the administrative burden on businesses, ultimately saving them time and effort.