This bill requires the Internal Revenue Service to create a new validation system for Electronic Filing Identification Numbers, or EFINs, which are unique credentials that tax professionals and firms use to electronically file tax returns on behalf of taxpayers. The IRS must establish this validation program within 24 months of the bill's enactment and create a real-time system that instantly confirms whether an EFIN is valid and active before it can be used to file returns. Tax preparation software companies will be required to check the IRS validation system before allowing any electronic filings, and the system must also identify whether an EFIN has been suspended, revoked, or compromised. The IRS must submit an implementation plan to Congress within 180 days and provide a performance report two years after the system launches, detailing system availability, response times, and the number of validation requests processed. This measure aims to prevent fraudulent tax filings and protect the integrity of electronic tax filing by ensuring only authorized users with active credentials can file returns electronically.
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