Taxpayers can now upload more documents to IRS; new online option for 9 notices can help resolve issues faster

WASHINGTON — The Internal Revenue Service announced today that taxpayers who receive certain notices requiring them to send information to the IRS now have the option of submitting their documentation online through

This new secure step will allow taxpayers or their tax professional to electronically upload documents rather than mailing them in, helping reduce time and effort resolving tax issues.

In this stage of the ongoing effort, nine notices will be available for this feature. This potentially can help more than 500,000 taxpayers each year who receive these notices, which include military personnel serving in combat zone areas and recipients of important credits like the Earned Income Tax Credit and Child Tax Credit.

“This capability is another step forward by the IRS to help taxpayers and improve service,” said IRS Acting Commissioner Doug O’Donnell. “This provides immediate benefits to taxpayers, who have nearly instant confirmation that documents were received by the IRS. In turn, this will dramatically speed up the resolution of issues by removing a time-consuming step in the process. This means people can have their issues resolved much faster, including getting refunds to affected taxpayers faster. We will continue to look at improvements like this as we work to transform the IRS following passage of the Inflation Reduction Act last year.”

Initially, the online correspondence feature will be available to taxpayers who receive one of nine IRS notices. For the most part, the IRS sends these notices to individual tax filers claiming various tax benefits, such as the Earned Income Tax Credit for low- and moderate-income workers, the Child Tax Credit for families with dependents, the Premium Tax Credit for those who obtain health coverage through the Health Insurance Marketplace and members of the military claiming combat zone tax benefits.

Taxpayers receiving these notices can respond securely to IRS online, regardless of whether they have an IRS Online Account.

IRS created the Document Upload Tool

IRS information technology specialists developed a prototype for the Document Upload Tool in 2021. Since then, the IRS has been testing this feature on a limited number of exam-related notices, and 38% of the responses to these notices have used the agency’s secure electronic communications rather than traditional mail.

How it works

Language on the notice informs the taxpayer to, “Send us your documents using the Documentation Upload Tool within 30 days from the date of this notice.” It includes the link and a unique access code.

  • The taxpayer can open the link in any browser and then input their unique code, their first and last name and their Social Security, Individual Taxpayer Identification or Employee Identification number.
  • The taxpayer can then securely upload scans, photos or digital copies of documents (maximum of 15MB per file, up to 40 files).
  • The taxpayer receives a confirmation that the IRS received their documents, and the IRS employee assigned the case can manage the transmitted documents.

What notices qualify?

Taxpayers who receive one of the following notices with the link and access code can choose to upload their documents:

  • CP04, relating to combat zone status.
  • CP05A, information request related to a refund.
  • CP06 and CP06A, relating to the Premium Tax Credit.
  • CP08, relating to the Child Tax Credit.
  • CP09, relating to claiming the Earned Income Tax Credit.
  • CP75, relating to the EITC.
  • CP75a, relating to the EITC.
  • CP75d, relating to the EITC and other credits.

Future expansion planned

In the coming months and years, the IRS plans to expand this capability to dozens of other notices. In addition, the IRS will offer digital correspondence on a variety of other taxpayer interactions. During live interactions such as phone calls with taxpayers, IRS employees will be able to grant upload access by providing the link and unique access code.

With secure digital correspondence, everybody wins

For taxpayers and tax professionals working with the IRS, this new capability reduces the correspondence burden, ensures tax compliance and improves the customer experience. For IRS employees, this reduces paper correspondence, decreases processing time and speeds case resolution.

For more information, see the Fact Sheet 2023-05, IRS expands secure digital correspondence for taxpayers.

Make your Ohio income tax payments electronically!

The Department has an easy, secure, and free option for you to make payments using the “Guest Payment” feature on our website.

If you are:

  • An individual who pays their Ohio income tax payments by paper check, OR
  • A tax preparer who generates payment vouchers/coupons for your clients to attach to their paper check to pay their IT 1040 or SD 100 return payments, or their Ohio income or school district income tax estimated payments

Then make your SECURED payment using our EASY and FREE service by:

  • Visiting the Department’s “Guest Payment” feature on our website at:
  • Following the prompts to enter your specific information (name, SSN, bank routing and account number, payment type, etc.)

Benefits of the “Guest Payment” feature:

  • Safely, and securely pay your Ohio tax
  • Instant confirmation your payment has been received by the Department
  • Never miss an estimated payment with prescheduled payments
  • Eliminate the need to search for the correct payment voucher/coupon
  • Save money on postage required to mail a paper check
  • It’s as easy as 1, 2, free!

Notice 2023-23: Financial institution reporting for 2023 RMDs

Executive summary: Notice 2023-23

Notice 2023-23 provides guidance to financial institutions on reporting required minimum distributions (RMDs) for 2023 based on SECURE 2.0 changes.

Notice 2023-23: Financial institution reporting for 2023 RMDs

Notice 2023-23

On March 7, 2023, the IRS released notice 2023-23 providing guidance to financial institutions on reporting RMDs for 2023.

SECURE 2.0 amended section 401(a)(9)(C) to delay the required beginning date applicable to section 401(a) plans and other eligible retirement plans under section 402(c)(8), including individual retirement accounts and annuities (IRAs).

The required beginning date (date by which RMDs must begin) for an IRA owner who turns age 72 after Dec. 31, 2022and age 73 before Jan. 1, 2033 is April 1 of the calendar year following the year in which the individual turns 73. Prior to SECURE 2.0 an IRA owner would need to begin RMDs by April 1 of the calendar year following the year in which they turn 72.

The amendment under SECURE 2.0 is effective for distributions required to be made after Dec. 31, 2022 for individuals who will turn 72 after that date. Individuals who turn 72 in 2023 (anyone born in 1951) will have a required beginning date of April 1, 2025 rather than April 1, 2024. Therefore, these individuals will have no RMD due for the 2023 tax year.

IRA Reporting

For IRA owners who have a RMD due in 2023 the financial institution acting as the trustee, custodian or issuer must file a 2022 Form 5498 by May 31, 2023 and check Box 11 that a RMD is required for 2023. The financial institution may also provide further information in Box 12a (RMD date) and Box 12b (RMD amount). Under notice 2002-27, 2002-1 CB 814, the financial institution must furnish a statement to the IRA owner by Jan. 31, 2023 that informs the IRA owner of the date by which the RMD must be distributed and either provides the amount of the RMD or offers to calculate that amount on request (RMD statement).

For IRA owner who will turn 72 in 2023 the financial institution should not send the RMD statement required under Notice 2002-27 and the 2022 Form 5498 should not have Box 11 checked or any entries in Box 12a or 12b. This notice does provide relief for financial institutions who may have already sent out RMD statements to those individuals who will turn 72 in 2023. As long as the financial institution notifies the IRA owner that no RMD is actually required for 2023 by April 28, 2023, the IRS will not consider the RMD statement to have been provided incorrectly to the IRA owner.

SECURE 2.0 did not change the required beginning date for IRA owners who turned 72 in 2022. The IRS encourages all financial institutions to remind IRA owners who turned 72 in 2022 that they are still required to take their RMDs by April 1, 2023.


Tax Time Guide: IRS reminder to report all income; gig economy and service industry, digital or foreign assets and sources

WASHINGTON — The Internal Revenue Service reminds taxpayers of their reporting and potential tax obligations on income from the gig economy and service industry, transactions from digital assets, and foreign sources or holding certain foreign assets.

Information available on and Instructions for Form 1040 and Form 1040-SR can help taxpayers understand and meet these reporting and tax requirements.

Gig economy earnings are taxable

Generally, income earned from the gig economy is taxable and must be reported to the IRS on tax returns.

The gig economy is activity where people earn income providing on-demand work, services or goods, such as selling goods online, driving a car for deliveries or renting out property. Often, it’s through a digital platform like an app or website.

Taxpayers must report income earned from the gig economy on a tax return, even if the income is:

  • From part-time, temporary or side work.
  • Paid in any form, including cash, property, goods or digital assets
  • Not reported on an information return form like a Form 1099-K, 1099-MISC, W-2 or other income statement.

For more information on the gig economy, visit the gig economy tax center.

Service industry tips are also taxable

People who work in restaurants, salons, hotels and similar service industries often receive tips for the customer service they provide. Tips are usually taxable income, and it’s important for people working in these areas to understand details on how to report tips.

Tips are optional cash or noncash payments customers make to employees.

  • Cash tips include those received directly from customers, electronically paid tips distributed to the employee by their employer and tips received from other employees under any tip-sharing arrangement. All cash tips must be reported to the employer, who must include them on the employee’s Form W-2, Wage and Tax Statement.
  • Noncash tips are those of value received in any other medium than cash, such as: tickets, passes or other goods or commodities a customer gives the employee. Noncash tips aren’t reported to the employer but must be reported on a tax return.

Employees don’t have to report tip amounts of less than $20 per month per employer. For larger amounts, employees must report tips to the employer by the 10th of the month following the month the tips were received.

The employee can use Form 4070, Employee’s Report of Tips to Employer, available in Publication 1244, Employee’s Daily Record of Tips and Report to Employer, an employer-provided form or other electronic system used by their employer.

For more information on how to report tips see Tip Recordkeeping and Reporting.

Understand digital asset reporting and tax requirements

The IRS reminds taxpayers that there’s a question at the top of Forms 1040 and 1040-SR that asks about digital asset transactions. All taxpayers filing these forms must check the box indicating either “yes” or “no.”

If an individual disposed of any digital asset that was held as a capital asset through a sale, exchange or transfer, they should check “Yes” and use Form 8949, Sales and other Dispositions of Capital Assets, to figure their capital gain or loss and report it on Schedule D (Form 1040), Capital Gains and Losses, or Form 709, United States Gift (and Generation-Skipping Transfer) Tax Return, in the case of a gift.

Examples of transactions involving digital assets include:

  • A sale of digital assets.
  • The receipt of digital assets as payment for goods or services provided.
  • The receipt or transfer of digital assets for free (without providing any consideration) that does not qualify as a bona fide gift.
  • The receipt of new digital assets as a result of mining and staking activities.
  • The receipt of new digital assets as a result of a hard fork.
  • An exchange of digital assets for property, goods or services.
  • An exchange/trade of digital assets for another digital asset(s).
  • Any other disposition of a financial interest in digital assets.

If individuals received any digital assets as compensation for services or disposed of any digital assets they held for sale to customers in a trade or business, they must report the income as they would report other income of the same type (for example, W-2 wages on Form 1040 or 1040-SR, line 1a, or inventory or services on Schedule C).

More information on digital assets can be found in the Instructions for Form 1040 and 1040-SR and on the IRS’ Digital Assets page.

Report foreign source income

A U.S. citizen or resident alien’s worldwide income is generally subject to U.S. income tax, regardless of where they live. They’re also subject to the same income tax filing requirements that apply to U.S. citizens or resident aliens living in the United States.

U.S. citizens and resident aliens must report unearned income, such as interest, dividends and pensions from sources outside the United States unless exempt by law or a tax treaty. They must also report earned income, such as wages and tips, from sources outside the United States.

An income tax filing requirement generally applies even if a taxpayer qualifies for tax benefits, such as the Foreign Earned Income Exclusion or the Foreign Tax Credit, which substantially reduce or eliminate U.S. tax liability. These tax benefits are available only if an eligible taxpayer files a U.S. income tax return.

A taxpayer is allowed an automatic two-month extension to June 15 if both their tax home and abode are outside the United States and Puerto Rico. Even if allowed an extension, a taxpayer will have to pay interest on any tax not paid by the regular due date of April 18, 2023.

Those serving in the military outside the U.S. and Puerto Rico on the regular due date of their tax return also qualify for the extension to June 15. IRS recommends attaching a statement if one of these two situations applies. More information can be found in the Instructions for Form 1040 and Form 1040-SR, Publication 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad and Publication 519, U.S. Tax Guide for Aliens.

Reporting required for foreign accounts and assets

Federal law requires U.S. citizens and resident aliens to report their worldwide income, including income from foreign trusts and foreign bank and other financial accounts. In most cases, affected taxpayers need to complete and attach Schedule B (Form 1040), Interest and Ordinary Dividends, to their tax return. Part III of Schedule B asks about the existence of foreign accounts such as bank and securities accounts and usually requires U.S. citizens to report the country in which each account is located.

In addition, certain taxpayers may also have to complete and attach to their return Form 8938, Statement of Foreign Financial Assets. Generally, U.S. citizens, resident aliens and certain nonresident aliens must report specified foreign financial assets on this form if the aggregate value of those assets exceeds certain thresholds. See the instructions for this form for details.

Further, separate from reporting specified foreign financial assets on their tax return, U.S. persons with an interest in or signature or other authority over foreign financial accounts where the aggregate value exceeded $10,000 at any time during 2022 must file electronically with the Treasury Department a Financial Crimes Enforcement Network (FinCEN) Form 114, Report of Foreign Bank and Financial Accounts (FBAR). Because of this threshold, the IRS encourages U.S. persons with foreign assets, even relatively small ones, to check if this filing requirement applies to them. The form is available only through the BSA E-filing System website.

The deadline for filing the annual Report of Foreign Bank and Financial Accounts (FBAR) is April 15, 2023. FinCEN grants U.S. persons who miss the original deadline an automatic extension until Oct. 15, 2023, to file the FBAR. There is no need to request this extension. See FinCEN’sPDF website for further information.

This news release is part of a series called the Tax Time Guide, a resource to help taxpayers file an accurate tax return. Additional guidance is available in Publication 17, Your Federal Income Tax (For Individuals).

Ohio Supreme Court to hear oral arguments for 2020 municipal income tax refunds

The Ohio Supreme Court is set to hear oral arguments on Wednesday, March 1 in taxpayers’ case to obtain 2020 municipal income tax refunds. The arguments will be broadcast live beginning at 9:00am on the Ohio Channel, where they are also archived. Court News Ohio on Feb. 22 wrote a preview of the case, and the Court’s Office of Public Information also released a detailed article.

OSCPA filed an amicus brief on Aug. 10, 2022, to support those taxpayers based on the Society’s position that taxing persons who neither work nor live in a jurisdiction is unconstitutional.

In the amicus brief, OSCPA argues that the cities are “effectively interpreting R.C. 718.011 and Section 29 as a taxing provision, or in the alternative, as a situs of where income was earned provision, but that is not what R.C. 718.011 or Section 29 says or means. R.C. 718.011 is not a taxing provision, nor does R.C. 718.011 situs where income is earned for purposes of imposing tax. It is a safe harbor to simplify employer withholding. It clearly states that the deemed location is “for purposes of division (B)(1)” – (where the 20-Day Withholding Exception is codified) and does not determine the ultimate taxability of the wages in the hands of the employee.”

Section 29 and R.C. 718.011 of House Bill 197, a 2020 law change early in the pandemic, was intended to address the significant withholding challenges faced by employers of workers who suddenly were working remotely – often outside the city where the business itself was located.  However, many cities where the money was withheld refused to grant refunds to remote taxpayers.

OSCPA worked in 2021 to secure a law change in House Bill 110 ensuring qualified remote workers would be able to receive municipal tax refunds for Tax Year 2021. In that same bill, the Legislature left it up to the Ohio Supreme Court to address refunds for 2020. The goal is that the Ohio Supreme Court will clearly recognize the distinction between employers’ withholding and employees’ tax liability.

Several cases were filed in Ohio questioning the constitutionality of requiring individual taxpayers to pay income tax to municipalities where they neither lived nor physically performed services.  Two of those cases have reached the Ohio Supreme Court. Both were decided against the taxpayers at the appellate level, and the Ohio Supreme Court declined to hear the first appeal (Columbus) in March 2022.

However, the Ohio Supreme Court voted 4-3 on June 7, 2022 to take up the second case (Cincinnati), Schaad v. Alder. Justices Kennedy, DeWine, Fischer, and Donnelly voted to take up the case.  Justices O’Connor, Stewart, and Brunner dissented.  O’Connor has since been replaced on the Court by Justice Joseph Deters.

A final decision is not expected until several months after the March 1 oral arguments.

Marissa L. Wilson

Congratulations to Marissa Wilson on five years with ARM!

We appreciate her team spirit and true dedication in growing the ARM Team!