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Q&A: Heavy Highway Vehicle Use Excise Tax, Form 2290 IRS Gives Storm Victims More Time to File and Pay; Taxpayers in Parts of 10 States Qualify
| Q&A: Heavy Highway Vehicle Use Excise Tax, Form 2290 Excise Tax Form 2290, or the Heavy Highway Vehicle Use tax return, is going electronic. As of August of last year, the IRS has begun encouraging the e-filing of Forms 2290, and even mandating electronic filing for anyone filing a Form 2290 to cover 25 or more vehicles. We’ve compiled the Frequently Asked Questions on 2290 e-filing, or the Electronic Excise Tax (formerly the ETEC), for you here, with the answers straight from the IRS. Q. What is ETEC? A. Excise Tax e-File and Compliance (ETEC) – also known as Electronic Excise – is the project that enabled electronic filing of Excise Tax Form 2290, Heavy Highway Vehicle Use Tax Return, effective August 2007. Form 720, Quarterly Federal Excise Tax Return and Form 8849, Claim for Refund of Excise Taxes are also available for e-file. Q. Why is the IRS offering Excise e-file? A. Offering electronic filing of Form 2290 will satisfy Congressional mandate to provide filers an electronic option for filing Excise Form 2290. Q. Who may file Excise forms electronically? A. Any taxpayer who pays the provider’s required service fee for on-line submission will be able to electronically transmit Form 2290.
A. The American Jobs Creation Act requires that any taxpayer who files a Form 2290 return with respect to 25 or more vehicles for any taxable period shall file such returns electronically. Q. What are my options for Excise Forms 2290 if I have a requirement to e-file or if I simply want to e-file the Excise forms? A. If you prepare your own income tax return, you will be required to submit it through an approved transmitter/software provider. Taxpayers are not permitted to e-file directly to the IRS. A list of providers is available at www.irs.gov . Type “2290 e-file” in the keyword search box. Click on the 2290 e-file link to see approved providers. Electronic excise is available to all filers of the Form 2290. Q. How do I choose a transmitter to e-file Excise Tax returns? A. IRS will post the contact information of all approved e-file transmitters on www.irs.gov . You will need to select one to your liking. IRS does not endorse any one provider and cannot make recommendations. All listed providers are approved to submit returns to the IRS electronically. Q. When can I e-file Forms 2290, 720, and 8849? A. IRS is currently accepting electronically-filed Form 2290, Heavy Highway Vehicle Use Tax; Form 720, Quarterly Federal Excise Tax; and Form 8849, Claim for Refund of Excise Taxes. Q. Where and how do I access the electronic Excise Tax forms? A. Taxpayers will be required to submit their electronic Excise Tax forms through an approved Q. Will I be able to transmit the Excise forms directly to the IRS? A. Taxpayers will not be able to transmit their Excise forms directly to the IRS. They must go through an approved software provider. Q. Will it cost anything to file Excise Tax forms? A. Yes. To electronically file Excise forms, taxpayers will incur the cost of the provider’s required service fee for on-line submission. Q. Can all Excise Tax forms be filed electronically? A. No. At this point, the only Excise forms available for electronic filing are Form 2290, Heavy Highway Vehicle Use Tax; Form 720, Quarterly Federal Excise Tax; and Form 8849, Claim for Refund of Excise Taxes. Q. Will the IRS provide training, publications, or instruction to assist in filing? A. IRS will not provide training for taxpayers. However, IRS will provide support to the software manufacturers/vendors. Taxpayers should seek technical support from their software providers. Q. Will IRS continue to accept paper forms once electronic forms are available? A. Yes. IRS will continue to accept paper Excise Tax forms for anyone registering fewer than 25 vehicles on Form 2290. Q. Will IRS continue to provide stamped copies of Schedule One (1)? A. IRS will provide stamped copies of the Schedule One (1) through the mail for paper returns. Taxpayers filing electronic returns will receive Schedule 1 electronically through their transmitter or software provider. The electronic Schedule One (1) will contain an e-file logo watermark and can be printed for your use.
A. Electronic filing of Forms 2290, 720, & 8849 will allow IRS to provide expedited service to taxpayers and reduce errors. Q. Will refunds be sent electronically? A. Currently, Excise refunds are manually processed and distributed in the form of paper checks. IRS is working to make an electronic refund option available. Differences Between The Paper and Electronic Processes Q. Are paper filed Form 2290s handled any differently than those e-filed? A. Yes, there are differences in the processing of paper returns verses electronically filed returns. Paper returns are processed manually. If a paper return is filed containing duplicate vehicle identification numbers (VINs), manual procedures make it easy to identify and correct the error. Paper returns can be filed multiple times and are generally accepted. Paper filers will receive a hard copy stamped Schedule 1. Electronically filed returns can be submitted more than once. However, if the second return is filed for the same EIN and tax period, listing the same VIN number and category shown in the first position of the Schedule1, it will be rejected. This is to ensure taxes are only paid once on each vehicle. Electronically submitted returns/Schedule 1 VINs cannot be corrected through additional electronic filing. You must submit a paper copy of the electronic return in order to make corrections to the VINs. Electronic filers will receive an electronic version of the Schedule 1 containing a watermark of the e-file logo in the background. Filing Requirements Q. If I purchase a new vehicle and want to register it with the DMV right away, am I required to produce a stamped Schedule 1 before I can register the vehicle? A. No proof of payment is required for a newly purchased vehicle, if you present the state with a copy of the bill of sale showing that the vehicle was purchased within the last 60 days. However, you still must file a return and pay any tax due. See When To File on page 3 of the 2290 Instructions . If you e-file your Form 2290, you will receive an electronic version of the Schedule 1 containing a watermark of the e-file logo in the background. Q. If I e-file my original Form 2290 return, can I e-file subsequent 2290 returns? A. Yes, you can e-file subsequent 2290 returns. However, you should only include the new VINs not included on the original return. Including VINs from a previously filed return may cause the balance due field to reflect more than what you actually owe for the new vehicles. This could result in overpayment. Including only those new VINs will ensure accurate balance due amounts. Q. When should I file a Form 2290? A. Form 2290 must be filed for each month a taxable vehicle is first used on public highways during the current tax period. The current period begins July 1 and ends June 30 of the following year. Form 2290 must be filed by the last day of the month following the month of first use (as shown in the chart on page 3 of the Form 2290 Instructions, When To File). Example: If your vehicle is placed on the road on or after July 1, 2008, you must file Form 2290 by August 31, 2008. Multiple e-Filing Q. Am I limited in the number of Form 2290s I can e-file in a given year? A. You may file as many Form 2290s as you like. However, consolidating as many affected VINs as is possible (for the same tax period) on one return will save you money on electronic filing fees, minimize errors, and ensure accurate calculations. Q. If I purchase a new vehicle after I have e-filed my Form 2290 for the current period, should I re-file the original Form 2290 and simply add the new vehicle to the Schedule 1? A. No. If you e-file Form 2290 listing vehicles you currently own on the Schedule 1, then subsequently purchase a new vehicle, you must file a new Form 2290 listing only the new vehicles. You may file that Form 2290 anytime between the first and last day of the month following the first day/month the vehicle is used on public highways. Example: You e-file Form 2290 August 15, 2008, and purchase a new vehicle September 3, 2008, placing it on the road in the month of September. You must file a new Form 2290 before the end of the month of October. You should list only those new VINs not included on the original return. Since the new vehicle was put on the road after the beginning of the current tax period (July 1), the 2290 return will reflect a different tax period (i.e., September 1, 2008 – June 30, 2009). Therefore the tax due will reflect a prorated amount covering a shorter tax period. Q. Using the above Example (purchasing a new vehicle September 3), if I purchase an additional new vehicle on October 1, do I have to wait until November 1 to file Form 2290 registering the second vehicle? Or can I include the additional new vehicle on the same tax return as the September purchase? A. No, you don’t have to wait until November 1 to register the second vehicle, but you will need to file a separate Form 2290 for that vehicle. Since it was placed on the road in a different month than the previous vehicle, it will reflect a different tax period and different pro-rated tax amount. Error Handling
A. If you make a mistake on an e-filed return that has been accepted by the IRS, you will need to make corrections via a paper Form 2290. There is no provision for making corrections electronically. Q. What should I do if my electronically filed return is rejected for duplication? A. If your return is rejected as a duplicate, you should check to make sure the VINs listed are correct and not duplications from a previous filing. If you made an error, correct it and resubmit the return. If you are trying to submit corrections to VINs listed on a previously filed and accepted return, you will need to file a paper return and indicate “amended.” If the new VIN is totally different from what was listed on the original return/Schedule 1, you must explain why the VIN you are including is different. Q. When submitting my Form 2290 return, I received an on-line duplicate filing error. Why did this happen? A. When you submitted your return the system detected that you had already filed a return under the same EIN, for the same tax period, for the same vehicle(s) and/or for the same VIN category. Check your return to ensure that you are registering new vehicles only and that the information you input is correct. Q. What kind of corrections to my e-filed return can be made electronically? A. The only corrections that can be made electronically are those submitted to correct the weight or mileage category. Q. How can I ensure my vehicle use tax is calculated correctly? A. When filing Form 2290 include only those VINs representing vehicles not included on a previously filed Form 2290. Double check your form to ensure the category and tax period (as shown in the chart on page 3 of the Form 2290 Instructions , When To File) are reflected correctly.
This November’s presidential contest, with no incumbent and a host of pressing issues, promises to be…well, let’s just say interesting. The main party candidates, as usual, are jockeying to present their sure-fire fixes for all American ills, and taxes figure big on both sides. Both John McCain and Barack Obama have promised to ‘simplify’ taxpaying, and both promise changes to the tax code that may affect professional taxpayers. We’ll give you a non-partisan brief here, with the link to each one’s website—just in case you want to bend your candidate’s ear. McCain—Not flat, but “flatter.” McCain is promising two tax systems: same old same old, if deductions are what you want, or a new, simpler, alternative. Taxpayers could opt for either; the new system would have two different tax rates and a standardized, “generous,” deduction—for foolproof filing. He is also promising to eliminate Alternative minimum tax for all individuals and lower capital gains tax rates to 0%. Go to www.JohnMcCain.com for more information. Obama—Trust, but verify. Obama’s plan will eliminate taxes for up to 10 million Americans—and offer others the option to receive tax forms that have already been filled out by the IRS. Taxpayers would only have to “verify, sign, and return” the pre-filled forms—in effect, trusting the IRS for both tax prep and tax collection. He thinks these measures will save middle class individuals billions in professional tax preparations fees with the pre-filled out tax forms. He is also promising to lower or eliminate alternative minimum tax for middle class individuals, and increase capital gains tax rates to regular tax rates. Check out www.BarackObama.com for more details.
IRS Gives Storm Victims More Time to File and Pay; Taxpayers in Parts of 10 States Qualify
Victims of storms and flooding in 10 states will have more time to make quarterly estimated tax payments normally due June 15, according to the Internal Revenue Service. "Our hearts go out to the flood victims in the stricken states," IRS Commissioner Doug Shulman said. "At a time like this, taxes should be the last thing on the minds of these unfortunate victims." Over the weekend the IRS provided tax relief, including the postponement of various tax-filing and tax-payment deadlines, to disaster-area counties in Iowa, Indiana and Wisconsin. Earlier this spring, the agency extended similar relief to storm victims in parts of Arkansas, Colorado, Georgia, Maine, Mississippi, Missouri and Oklahoma. As a result, self-employed individuals, retirees and others in these areas who make quarterly estimated tax payments will have more time to make the payment normally due today. Businesses will also have extra time to file various returns and pay any taxes due. Due dates vary, depending upon location, and details are available on the Tax Relief in Disaster Situations page on this Web site. In addition, affected taxpayers in these areas who suffered uninsured or unreimbursed property damage can choose to claim these losses on their 2007 tax returns. The IRS is monitoring and regularly updating all available relief.
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