Upcoming IRS Improvements Tailored for Small Business Owners

The Internal Revenue Service (IRS) is ushering in a wave of improvements designed to empower small business taxpayers. These changes, set to enhance phone service, in-person interactions, and online options, aim to provide seamless assistance tailored to the unique needs of small businesses.

Let’s take a look.

The Catalyst: Inflation Reduction Act (IRA)

The driving force behind these forthcoming enhancements is the Inflation Reduction Act (IRA), enacted in August 2022. The IRS’s Strategic Operating Plan outlines the strategic utilization of IRA funds to elevate customer service and address other key priorities. 

For more information on the Inflation Reduction Act, check out our guide, here.

Expected Enhancements for Small Business Owners

Expanded Online Service Tools

As we look ahead, the IRS is gearing up to introduce a revolutionary tool designed exclusively for small business taxpayers: Business Online Accounts. This feature, scheduled to debut before the next filing season, is poised to be a game-changer. Small businesses can expect the following benefits as the tool evolves:

  1. Access Tax Information: Seamlessly view and manage tax information through a user-friendly interface.
  2. Payment Management: Effortlessly schedule and track payments, providing enhanced control and convenience.
  3. Transcripts Access: Enjoy easy access to business tax transcripts presented in a clear and understandable format.

This enhancement underscores the IRS’s commitment to harnessing technology for the benefit of small businesses.

Streamlined Responses and Document Filing Online

In pursuit of efficiency and reduced reliance on paper, the IRS has recently launched an online portal for businesses to electronically file Form 1099 series information returns, replacing traditional mail submissions.

Anticipate the ability to respond to specific notices online, such as the LTR0143C (Signature Missing), by this summer. The IRS is dedicated to continuous improvement, with expanded capabilities expected by 2024. Small business owners can look forward to responding to self-employment income corrections, employment-related identity theft notifications, and various other online notices. Simultaneously, efforts to simplify the language in these notices aim to enhance clarity and understanding for taxpayers.

Simplified, Mobile-Friendly Forms

Understanding the value of time for small business owners, the IRS is set to modernize and simplify frequently used tax forms. Forms 940, 941, and 944 are in line for a transformation, becoming streamlined, mobile-friendly, and available in multiple languages.

 This initiative aims to enhance the user experience, particularly for those managing their tax filings independently.

Digitization for Efficiency

Embracing the digital era, the IRS is taking significant strides to eliminate paper-based processes. Through the automation of paper-based procedures and the availability of forms online, the IRS aims to achieve improved processing times and faster refunds. Notably, the IRS is expanding its scanning capabilities to include popular forms like 1040 and 941. 

This digitization initiative, set to scan millions of returns in 2023, is poised to save small businesses both time and money by expediting processing and refund delivery. The IRS’s commitment to efficiency and modernization is clear, offering small business owners a glimpse into a more streamlined and digitally-driven future.

Final Notes: A Future-Forward IRS for Small Businesses

As small businesses navigate the dynamic landscape of tax compliance, the upcoming IRS improvements stand as a beacon of support. From enhanced online tools to simplified forms and digitization, these changes underscore the IRS’s commitment to fostering a conducive environment for small business owners. 

The future promises increased efficiency, accessibility, and clarity, aligning with the evolving needs of the small business community. Stay tuned for a new era of interaction with the IRS, empowering small businesses to thrive in an ever-changing economic landscape.

Any Questions?

Business owners should contact Milikowsky Tax Law if they have any additional questions about how these changes will impact them. At Milikowsky Tax Law, we have over a decade of experience working with IRS and tax audits. We’re experts in defending business owners in the face of IRS or other government agency audits. Interested in learning more? 
Read on to learn how to respond to an IRS audit.