September 2 2021

IRS Issues Fact Sheet on E-Signatures

Source: IBFD Tax Research Platform News

The US Internal Revenue Service (IRS) has issued a Fact Sheet (FS-2021-12) with an overview about using electronic or digital signatures on certain IRS forms. The Fact Sheet was last reviewed or updated on 1 September 2021.

An electronic signature is a way to get approval on electronic documents. The IRS will accept a wide range of electronic signature methods, including:

  • a typed name typed on a signature block;
  • scanned or digitized image of a handwritten signature that is attached to an electronic record;
  • a handwritten signature input onto an electronic signature pad;
  • a handwritten signature, mark or command input on a display screen with a stylus device; and
  • a signature created by a third-party software.

The IRS does not specify what technology a taxpayer must use to capture an electronic signature. The IRS will accept images of signatures (scanned or photographed) including common file types such as tiff, jpg, jpeg, pdf, Microsoft Office suite or Zip.

The IRS allows taxpayers and their representatives to use electronic signatures on certain paper forms, which they cannot file using IRS e-file. The Fact Sheet includes a list of those forms. The forms are available on the IRS's webpage under the heading of "Forms, Instructions & Publications."

The Fact Sheet notes that the IRS is balancing the electronic signature option with critical security and protection needed against identity theft and fraud.