The Taxpayer Authentication is available in Screen 4.2, Electronic Filing. The IRS does not require this information for electronically filed returns. However, entering this information will help protect the taxpayer from refund fraud. Additionally, some states may require it be entered.
The following reference information is provided as guidelines from the Internal Revenue Service to tax professionals with regard to taxpayer authentication.
Q1: Why am I being asked for this information?
A1: In an effort to comply with standards provided by the IRS for electronic filing of returns, these fields were add for taxpayer authentication. They serve to better protect the taxpayer from refund fraud.
Q2: Do I need to enter this information to file my Federal Tax Return?
A2: This information is optional currently at the Federal tax return level. However, some states may require certain elements.
Q3: Are there multiple places to enter this data?
A3: Since this information is now required of many state returns, we have moved it to a more central location in Screen 4.2, Electronic Filing. Previous years have had these input fields in other locations. Because of this, transition years are unable to proforma the information up from the prior locations. This is an inconvenience, but going forward this will be the screen to enter taxpayer authentication information for all complying states.