IRS permanently allows e-signatures on dozens of tax forms

The Internal Revenue Service has extended the ability to digitally sign a wide variety of tax forms indefinitely, enshrining a temporary grant of relief for the pandemic into a more permanent policy.

The IRS updated the web page Wednesday on using e-signatures for certain forms, explaining the move would help reduce the burden on the tax community to allow taxpayers to use electronic or digital signatures on certain paper forms they cannot file electronically. The IRS said it’s balancing the e-signature option with the security and protection needed to safeguard against identity theft and fraud. The agency will accept a variety of electronic signatures.

The accommodation started out as a temporary policy last year to help taxpayers and tax professionals, but the IRS has now removed the term “temporary” from the language in its fact sheet. The IRS has long allowed taxpayers to digitally sign their 1040 individual tax returns that they file with consumer tax prep software, but the policy allows tax professionals to let their clients sign a wide variety of tax forms electronically.

Acceptable e-signature methods include a typed name typed on a signature block; a scanned or digitized image of a handwritten signature that's attached to an electronic record; a handwritten signature input onto an electronic signature pad; a handwritten signature, mark or command input on a display screen with a stylus device; and a signature created by a third-party software.