SECTION 5. APPLICATION FOR THE

FORM 940 e-file PROGRAM

.01 A prospective Electronic Filer must first submit an LOA to the Service to participate in the Form 940 e-file Program. The LOA of a prospective Electronic Filer may be submitted electronically or by paper. See Publication 3715 for a sample LOA for an Agent, a Software Developer, and a Transmitter, and the application procedures.

.02 A prospective On-Line Filer must submit an electronic LOA through a Transmitter to participate in the Form 940 e-file Program. A prospective On-Line Filer must use the electronic LOA provided in the commercial tax preparation software used by the taxpayer in order to participate in the Form 940 e-file Program. The Transmitter is required to batch and bundle the electronic LOA files, and then transmit those files to the Service. The Transmitter is required to send an acknowledgment to the On-Line Filer to verify that the electronic LOA was transmitted successfully to the Service.

.03 In addition to the LOA, an Agent must also include an Agent’s List, providing the names of all taxpayers for which it will file returns. Each name on the Agent’s List must be accompanied by an Authorization made on Form 8655, or acceptable substitute, except as provided in section 5.04 of this revenue procedure. See Rev. Proc. 96–17, as modified by section 18 of this revenue procedure, for general instructions on preparing Form 8655. See section 6.10 of this revenue procedure

for instructions on adding names to, or deleting names from, the Agent’s List.

.04 A revised Authorization is not required to replace an Authorization made on Form 8655 with a revision date before October 1995 (or its equivalent) that was previously submitted to the Service by an Agent, if the Authorization places no restriction on the medium for filing Form 940, and the Agent: (1) advises its client that its Forms 940 may be filed electronically, and provides the client with the option of rejecting electronic filing as the medium for filing its Forms 940. An Agent may use the most efficient and timely method of clearly providing this notification to a client. A client’s rejection of electronic filing for its Forms 940 must be submitted in writing to the Agent; and

(2) immediately removes from its electronic filing client base any client that rejects having its Forms 940 filed electronically.