IRS Has Reported Programming Issues Affecting COVID-19 Relief For Businesses
The IRS warned yesterday that a technical bug in its computer system could be affecting business taxpayers who need a transcript for requesting COVID-19 employment tax relief. Specifically, the problem affects transcripts requested for Form 941, the Employer’s Quarterly Federal Tax Return.
There are several different types of tax transcripts, with the most commonly used and needed being the tax return transcript. Here’s how they break down according to the IRS website:
- Tax Return Transcript: This document shows most line items, including your adjusted gross income from your original Form 1040-series tax return as filed, along with any forms and schedules. It does not show changes made after you filed your original return and this transcript. It is a log, of sorts, to get all of your form and schedules into one place. The IRS says a tax return transcript usually meets the needs of banks and lending institutions for mortgages and student loans.
- Tax Account Transcript: Operating in much in the same way (except that it actually does show changes made after you filed your original return), this transcript is available for the current tax year and up to ten years prior using online IRS tools.
- Record of Account Transcript: This document combines the tax return and tax account transcripts into one, and is available for the current tax year and returns processed during the past three years.
- Wage and Income Transcript: Data from information returns received such as Forms W-2, 1099, 1098 and Form 5498 is displayed here. IRA contribution information can also be claimed on these forms.
Some of these transcripts and others may be needed in order to request COVID-19 employment tax relief. The problem is only the latest in a series of technology problems plaguing the IRS, which has struggled to update antiquated systems to handle all the changes in tax policy and relief that have come to be since the pandemic, Accounting Today reports.
In an email to tax professionals, the IRS stated that there is a transcript delivery system programming issue impacting business taxpayers who reported information related to pandemic employment tax relief on Form 941.
Employers use Form 941 to report income taxes, social security tax or Medicare withheld from employee’s paychecks. Account transcripts requested for Form 941 for all quarters in Tax Year 2021 may not generate properly, the IRS added. Transcripts seem to not be delivered to the Secure Object Repository Mailbox for e-Services users. When viewing the transcript online, the IRS says a message will display on the transcript indicating TDS has encountered an unrecoverable error processing the request.
While this will cause delays, the IRS expects the problem to be ironed out by September 26, 2021.
More From GOBankingRates
- What Money Topics Do You Want Covered: Ask the Financially Savvy Female
- The 8 Best Deals From Costco’s September Coupon Book
- Nominate Your Favorite Small Business To Be Featured on GOBankingRates
- 10 Reasons You Should Claim Social Security Early
Last updated: September 10, 2021