SECTION 4. ACCEPTANCE — Internal Revenue Bulletin 1996-53

ELECTRONIC FILING PROGRAM

.01 Except as provided in sections 4.02 through 4.04 of this revenue procedure, an Electronic Filer that has ac

tively participated in the 1996 Electronic Filing Program does not have to reapply to participate in the 1997 Electronic Filing Program. However, an Electronic Filer that intends to function as a Transmitter or a Software Developer in the 1997 Electronic Filing Program must first successfully complete the testing described in section 4.08 of this revenue procedure. In addition, section 4.15 of this revenue procedure provides for the Service’s issuance of credentials necessary for participation in the 1997 Electronic Filing Program.

.02 Applicants and Electronic Filers must file a new Form 8633, Application to Participate in the Electronic Filing Program, with completed fingerprint cards for the appropriate individuals if:

(1) the applicant has never actively participated in the Electronic Filing Program;

(2) the applicant is an Electronic Filer that has actively participated in the Electronic Filing Program and wants to operate an electronic filing business at a new location;

(3) the applicant has previously been denied participation in the Electronic Filing Program; or

(4) the applicant has been suspended from the Electronic Filing Program.

.03 To participate in the 1997 Electronic Filing Program, an Electronic Filer in the 1996 Electronic Filing Program must submit a revised Form 8633, signed by all Principals and the Responsible Official, with completed fingerprint cards for the appropriate individuals if:

(1) the Electronic Filer functioned solely as a Software Developer during the 1996 Electronic Filing Program and intends to function as an ERO, Service Bureau, or Transmitter during the 1997 Electronic Filing Program;

(2) there is an additional principal, such as a partner or a corporate officer, that must be listed on Form 8633, line 8 (formerly line 1k(1)), ‘‘Principals of Your Firm or Organization’’;

(3) there is a ‘‘Principal’’ listed on Form 8633, line 8, that should be deleted; or

(4) the ‘‘Responsible Official’’ on Form 8633, line 9 (formerly line 1k(2)), changes.

.04 To participate in the 1997 Electronic Filing Program, an Electronic Filer in the 1996 Electronic Filing Program must submit either a revised Form 8633, or a letter containing the same information contained in a revised Form

8633, if there is any revision to the following information:

(1) the Firm name or Doing Business As (DBA) name;

(2) the business or mailing address; (3) the contact representative or the alternate contact representative’s name or telephone number;

(4) the Electronic Filer’s form of organization, as described on Form 8633, line 1k; (5) the electronic functions performed by an Electronic Filer, other than an Electronic Filer that functions solely as a Software Developer; or

(6) the number or location(s) of drop-off collection points. A Form 8633 or letter submitted under this section should only include the information requested on lines 1a through 1i of Form 8633 and the information being revised. A Principal or a Responsible Official must sign the Form 8633 or the letter. .05 Applicants described in section 4.02 of this revenue procedure must submit new applications within the following time periods:

(1) except as provided in section 4.05(2) of this revenue procedure, the application period begins on August 1, 1996, and ends on December 2, 1996; and

(2) if an applicant purchases an Electronic Filer on or after November 1, 1996, a new application must be submitted within 30 days after the date of the purchase.

.06 Revised applications described in sections 4.03 and 4.04 of this revenue procedure must be submitted within 30 days of the change(s) reflected on the revised Form 8633 or in the letter.

.07 Applicants and Electronic Filers described in sections 4.02 through 4.04 of this revenue procedure must file Form 8633 (or a letter containing the same information as provided in section 4.04 of this revenue procedure) with the service center that accepts electronically filed returns from the applicant’s state.

.08 Applicants and Electronic Filers described in sections 4.01 through 4.03 of this revenue procedure that intend to function as a Transmitter or a Software Developer in the 1997 Electronic Filing Program must first successfully complete the necessary testing at the appropriate service center(s).

.09 Each individual listed as a Principal or a Responsible Official must:

(1) be a United States citizen or an alien lawfully admitted for permanent

residence as described in 8 U.S.C. § 1101(a)(20) (1994);

(2) have attained the age of 21 as of the date of application;

(3) submit with Form 8633 one standard fingerprint card with a full set of fingerprints taken by a law enforcement agency, except as provided in section 4.10 of this revenue procedure;

(4) pass a suitability check that includes a credit check and a fingerprint check; and

(5) if applying to be an ERO, meet state and local licensing and/or bonding requirements in connection with the preparation of tax returns and the collection of prepared returns that taxpayers intend to have electronically filed. However, if the state and local licensing and/or bonding requirements apply to a business entity, the individual(s) must demonstrate that the business entity meets the requirements.

.10 A Principal for a firm or organization includes the following:

(1) Sole Proprietorship. The sole proprietor is the Principal for a sole proprietorship.

(2) Partnership. Each partner who has a five percent (5%) or more interest in the partnership is a Principal of the partnership. If no partner has at least a 5% or more interest in the partnership, the Principal is an individual authorized to act for the partnership in legal and/or tax matters (at least one such individual must be listed on Form 8633).

(3) Corporation. The President, Vice-President, Secretary, and Treasurer of the corporation are each a Principal of the corporation.

(4) Other. The Principal for a forprofit entity that is not a sole proprietorship, partnership, or corporation, is an individual authorized to act for the entity in legal and/or tax matters (at least one such individual must be listed on Form 8633).

.11 A Responsible Official is the individual who oversees the daily operations of an Electronic Filer’s office. As set forth in section 4.12 of this revenue procedure, a Responsible Official may be responsible for more than one office.

.12 A Responsible Official is categorized as follows:

(1) TIER I RESPONSIBLE OFFICIAL. A ‘‘Tier I Responsible Official’’ is a Responsible Official who does not meet the definition of a ‘‘Tier II Responsible Official.’’ A Tier I Responsible Official should be able to physically visit on a daily basis each office for

which he or she is listed as a Responsible Official. A Tier I Responsible Official may be listed on a maximum of ten applications (Forms 8633).

(2) TIER II RESPONSIBLE OFFICIAL. A ‘‘Tier II Responsible Official’’ is an individual who has participated in the Electronic Filing Program as a Responsible Official during at least the two most recent filing seasons and who has never been suspended from participation in the Electronic Filing Program. A Tier II Responsible Official should be able to physically visit on a daily basis any office for which he or she is listed as a Responsible Official. A Tier II Responsible Official may be listed on a maximum of twenty applications (Forms 8633). .13 An individual may choose to submit evidence of the individual’s professional status in lieu of one standard fingerprint card if the individual is:

(1) an attorney in good standing of the bar of the highest court of any State, possession, territory, Commonwealth, or the District of Columbia, and is not currently under suspension or disbarment from practice before the Service;

(2) a certified public accountant who is duly qualified to practice as a certified public accountant in any State, possession, territory, Commonwealth, or the District of Columbia and is not currently under suspension or disbarment from practice before the Service;

(3) an enrolled agent pursuant to part 10 of 31 C.F.R. Subtitle A;

(4) an officer of a publicly held corporation; or

(5) a banking official who is bonded and has been fingerprinted within the last two years.

.14 If an Electronic Filer has a foreign location, the following information is required on any new or revised Form 8633: (1) the complete name of the contact representative at the foreign location;

(2) the complete mailing address for the foreign location (including city, country, and postal code);

(3) the complete business address for the foreign location (including city, country, and postal code);

(4) the complete local telephone number for the foreign location (include international access code, country code, and city code); and

(5) the information on lines 1m, 1n, 1p, and 1q of Form 8633 for the stateside contact representative. The

stateside contact representative will receive all Service correspondence for the foreign location relating to the Electronic Filing Program.

.15 The Service will issue credentials to eligible applicants for the 1997 Electronic Filing Program, as well as Electronic Filers that do not have to reapply pursuant to section 4.01, 4.03, or 4.04 of this revenue procedure (provided they have first satisfactorily completed the testing described in section 4.08 of this revenue procedure if they intend to function as a Transmitter or Software Developer). No one may participate in the Electronic Filing Program for the 1997 filing season without the following credentials:

(1) a letter of acceptance into the Electronic Filing Program for the 1997 filing season;

(2) an Electronic Filing Identification Number (EFIN);

(3) if appropriate, an Electronic Transmitter Identification Number (ETIN);

(4) if appropriate, a Service Bureau Identification Number (SBIN); and

(5) if appropriate, a Collection Point Identification Number (CPIN). .16 An ERO may not receive a letter of acceptance to participate in the 1997 Electronic Filing Program if the Service did not receive and accept during the 1996 filing season any electronically filed returns containing the ERO’s EFIN. In addition, an ERO may be dropped from the 1997 Electronic Filing Program if the Service does not receive and accept prior to April 15, 1997, any electronically filed returns containing the ERO’s EFIN. In either case, the Service will notify the ERO that it has been dropped from the Electronic Filing Program and explain what steps the ERO needs to take for future participation in the program.

.17 If an Electronic Filer is a Software Developer that performs no other function in the Electronic Filing Program but software development, no Principal or Responsible Official needs to pass a suitability check.

.18 If an Electronic Filer will have a drop-off collection point(s) (as defined in section 3.05 of this revenue procedure) for the 1997 filing season, an Electronic Filer must submit a Form 8633 that lists each drop-off collection point. By listing a drop-off collection site on Form 8633, an Electronic Filer becomes a ‘‘parent’’ in relation to a listed drop-off collection point.

.19 The following reasons, which apply to any firm, organization, Principal, or Responsible Official listed on Form 8633, may result in the rejection of an application to participate in the 1997 Electronic Filing Program (this list is not all-inclusive):

(1) conviction of any criminal offense under the revenue laws of the United States, or of any offense involving dishonesty or breach of trust;

(2) failure to file timely and accurate tax returns, including returns indicating that no tax is due;

(3) failure to timely pay any tax liabilities;

(4) assessment of tax penalties; (5) suspension/disbarment from practice before the Service;

(6) other facts or conduct of a disreputable nature that would reflect adversely on the Electronic Filing Program;

(7) misrepresentation on an application;

(8) suspension or rejection from the program in a prior year;

(9) unethical practices in return preparation;

(10) stockpiling returns prior to official acceptance into the Electronic Filing Program (see section 5.14 of this revenue procedure);

(11) knowingly and directly or indirectly employing or accepting assistance from any firm, organization, or individual that is prohibited from applying to participate in the Electronic Filing Program (see section 13.10 of this revenue procedure) or that is suspended from participating in the Electronic Filing Program (see section 13.11 of this revenue procedure). This includes any individual whose actions resulted in the rejection or suspension of a corporation or a partnership from the Electronic Filing Program; or

(12) knowingly and directly or indirectly accepting employment as an associate, correspondent, or as a subagent from, or sharing fees with, any firm, organization, or individual that is prohibited from applying to participate in the Electronic Filing Program (see section 13.10 of this revenue procedure) or that is suspended from participating in the Electronic Filing Program (see section 13.11 of this revenue procedure). This includes any individual whose actions resulted in the rejection or suspension of a corporation or a partnership from the Electronic Filing Program.