This Notice provides procedures for corporations, electing small business
corporations, and organizations required to file returns under section 6033
(taxpayers) to request a waiver of the requirement to electronically file
Form 1120, U.S. Corporation Income Tax Return; Form 1120S, U.S.
Income Tax Return for an S Corporation; Form 990, Return
of Organization Exempt From Income Tax; and Form 990-PF, Return
of Private Foundation or Section 4947(a)(1) Nonexempt Charitable Trust Treated
as a Private Foundation. This notice also includes guidance on
the timely filing of a return required to be electronically filed that is
On January 12, 2005, the Treasury Department and the Internal Revenue
Service (Service) issued temporary regulations that, beginning in 2006, require
certain large corporations, electing small business corporations and organizations
required to file returns under section 6033 to electronically file their income
tax or annual information returns. T.D. 9175, 2005-10 I.R.B. 665 [70 F.R.
Section 6011(e)(2) provides that the Service may not require an entity
to file returns on electronic media unless the entity is required to file
at least 250 returns during the calendar year. Under the temporary regulations,
corporations that meet this threshold and that have assets of $50 million
or more must file their Form 1120 or Form 1120S returns electronically for
taxable years ending on or after December 31, 2005. The temporary regulations
also require that tax exempt organizations with assets of $100 million or
more that are required to file returns under section 6033 and that meet the
250 return threshold file their Form 990 electronically for taxable years
ending on or after December 31, 2005. The $50 million and $100 million asset
thresholds will decrease to $10 million for taxable years ending on or after
December 31, 2006.
The temporary regulations further require private foundations or section
4947(a)(1) trusts (regardless of asset size) that are required to file returns
under section 6033 and that meet the 250 return threshold, to file their Form
990-PF electronically for taxable years ending on or after December 31, 2006.
Exclusions from the e-File Requirement
Temporary regulations sections 301.6011-5T, 301.6033-4T, and 301.6037-2T
and IRS publications provide for exceptions and hardship waivers from the
electronic filing requirement for corporations, organizations required to
file returns under section 6033, and electing small business corporations.
IRS Publication 4163, Modernized e-File (MeF) Information for Authorized
IRS e-file Providers of Forms 1120/1120S, and IRS Publication 4206, Information
for Authorized IRS e-file Providers of Exempt Organization Filings,
contain instructions for filing corporate and tax exempt organization returns
electronically, and exclude certain types of returns from the electronic filing
requirement. For example, for tax year 2005, the Service has excluded amended
returns from the electronic filing requirement. The Service, however, will
accept amended returns through the Modernized e-File (MeF) program effective
January 2007. For a complete and up to date list of the exclusions or for
further information on electronic filing, refer to Publication 4163, Publication
4206, and the IRS.gov Internet site. The Service will
post answers to frequently-asked questions on this site.
Timely Filing of Rejected e-Filed
If the portion of a return required to be filed electronically is transmitted
on or before the due date (including extensions) and is ultimately rejected,
but the electronic return originator and the taxpayer comply with the following
requirements for timely submission of the return, the return will be considered
timely filed and any elections attached to the return will be considered valid.
For taxable years ending on or after December 31, 2005, the Service will
allow the taxpayer 20 calendar days from the date of first transmission to
perfect the return for electronic resubmission.
If the electronic return cannot be accepted for processing electronically,
the taxpayer must file a paper return with the Service Center where it would
normally be filed. In order for the paper return to be considered timely,
it must be filed by the later of the due date, or 5 calendar days after the
date the Service last gives notification to the taxpayer that the return has
been rejected, as long as the first transmission was made on or before the
due date of the return (including extensions). The paper return should include
an explanation of why the return is being filed after the due date and include
a copy of the Service’s final rejection notification. A paper return
filed in accordance with this paragraph will be considered timely filed and
any elections attached to the return will be considered valid. A waiver request
does not have to be filed by the taxpayer under the perfection procedures
described in this paragraph.
Requests for Waiver of Electronic
When certain taxpayers required to file over 250 returns fail to file
electronically as required, those taxpayers may be liable for failure to file
penalties under I.R.C. §§ 6651 or 6652, unless the taxpayer
can establish that the failure to file the return electronically was due to
reasonable cause and not due to willful neglect. The temporary regulations
permit the Service to waive the electronic filing requirement if the taxpayer
demonstrates that undue hardship would result if it were required to file
its return electronically. The regulations require that taxpayers seeking
a waiver should request that waiver in the manner prescribed in applicable
revenue procedures or publications.
The Service will approve or deny requests for a waiver of the electronic
filing requirement based on each taxpayer’s particular facts and circumstances.
In determining whether to approve or deny a waiver request, the Service will
consider the taxpayer’s ability to timely file its return electronically
without incurring an undue economic hardship. The Service will generally
grant waivers for filing returns electronically where the taxpayer can demonstrate
the undue hardship that would result by complying with the electronic filing
requirement, including any incremental costs to the filer. Mindful of the
software and technological issues in filing electronically, the Service will
also generally grant waivers for filing returns electronically where technology
issues prevent the taxpayer from filing its return electronically. Guidance
on situations in which deviations or exclusions from the electronic filing
requirement can be made without a waiver request (e.g.,
amended returns) is available in IRS Publication 4163, IRS Publication 4206,
and on the IRS.gov Internet site.
Elements of a Waiver Request
To request a waiver, the taxpayer must file a written request containing
the following information:
(1) A notation at the top of the request stating, in large letters,
”Form 1120 e-File Waiver Request,” ”Form 1120S e-File Waiver
Request,” ”Form 990 e-File Waiver Request,” or ”Form
990-PF e-File Waiver Request.”
(2) The taxpayer’s name, federal tax identification number, and
(3) The type of form for which the waiver is requested.
(4) The taxable year for which the waiver is requested.
(5) The value of the taxpayer’s total assets at the end of the
taxable year as reported (or to be reported) on the entity’s Form 1120,
1120S, 990, or 990-PF.
(6) A detailed statement which lists:
a) the steps the taxpayer has taken in an attempt to meet its requirement
to timely file its return electronically,
b) why the steps were unsuccessful,
c) the undue hardship that would result by complying with the electronic
filing requirement, including any incremental costs to the taxpayer of complying
with the electronic filing requirements. Incremental costs are those costs
that are above and beyond the costs to file on paper. The incremental costs
must be supported by a detailed computation. The detailed computation must
include a schedule detailing the costs to file on paper and the costs to file
(7) A statement as to what steps the taxpayer will take to assure its
ability to file future returns electronically.
(8) A statement (signed by an officer authorized to sign the return,
as defined in section 6062 of the Code) with the following language:
Under penalties of perjury, I declare that the information contained
in this waiver request is true, correct and complete to the best of my knowledge
Requests from the taxpayer’s tax advisor/preparer must include
a valid power of attorney.
The waiver request should not be attached to the taxpayer’s paper
tax return. Extension requests or payments should not be submitted with the
Time for Filing a Waiver Request
Taxpayers are encouraged to file electronic filing waiver requests for
failure to file a return electronically at least 45 days prior to the due
date of the return, including extensions. This will give the Service time
to process the waiver request.
Place for Filing a Waiver Request
Until the Service issues further guidance, taxpayers should file a waiver
request with the Ogden Submission Processing Center.
Use the following address if using the U.S. Postal Service:
Internal Revenue Service
Ogden Submission Processing
Attn: Forms 1120 and 990 e-file Waiver
Ogden, UT 84201
Use the following address if using an overnight delivery service:
Internal Revenue Service
Ogden Submission Processing
Attn: Forms 1120 and 990 e-file Waiver
1973 N. Rulon White Blvd.
Taxpayers may also fax the waiver request to the following number:
Corporate taxpayers may email questions about e-file to: email@example.com.
Software developers and vendors may email questions about corporate e-file
Further information is available on the E-file for Charities and Nonprofits
webpage at the IRS.gov Internet site.
The principal author of this announcement is Michael Hara of the Office
of Associate Chief Counsel (Procedure & Administration). For questions
concerning a request for waiver, you may contact the Ogden Service Center
by calling 1-866-255-0654 and then selecting option 1, then 2, and then 5.
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