Chapter 7 Electronic Filing
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1 2003 DRAKE TAX SOLUTION Other Tab 191 Chapter 7 Electronic Filing Drake users can electronically file Federal tax returns through Drake. State returns can be piggybacked on Federal returns, or sent directly to the state, depending on state requirements. In addition, Piggyback states can be sent separately to the IRS as a State Only packet, with some exceptions 1. This can be useful when filing a multi-state return, or when the initial State return has been rejected and must be re-filed. Direct State returns are sent directly to the state e-file Service Center. Direct State returns can only be sent through Drake. State Only packets can be sent the same time the Federal return is sent. State Only packets are sent separately from the Federal return, but to the IRS. These are NOT Direct States. The IRS forwards the State Only packets to the states. Piggyback state returns are sent with the Federal return to the IRS. Becoming an Electronic Return Originator (ERO) requires some preseason planning, but will pay off when tax season arrives. Those who are new to electronic filing and/or new to Drake e-filing procedures can use this section for guidance and instructions on how to: Apply for an EFIN or ETIN Prepare the Transmission Transmit and Receive Test Transmissions Process Acknowledgements Search the EF Database 1. At this time, Hawaii, Oregon and Rhode Island do not accept State Only transmissions from the IRS.
2 192 Apply for an EFIN and/or ETIN 2003 DRAKE TAX SOLUTION APPLY FOR AN EFIN AND/OR ETIN For preparers who have an EFIN, to transmit business forms , 1120S and 1065, a revised 8633 must be filed requesting authorization to file these forms. New Drake clients without an IRS EFIN (Electronic Filing Identification Number) are assigned a temporary EFIN for bookkeeping purposes only. This temporary EFIN includes alpha characters and it does not enable electronic filing. Drake must have each preparer s IRS EFIN in our database before he/she can begin electronic filing. New Electronic Return Originators (EROs) need to complete and submit Form 8633 to the IRS, along with a set of fingerprint cards for each principal and responsible official of the company. Established EROs do not need to file Form 8633 unless they need to change the original information in the application. Form 8633 can be obtained in several ways: Call the IRS at and ask for the Electronic Tax Administration (ETA) Coordinator. Select Tools > Blank Forms > 1040 Forms on the program Menu Bar. Print the 8633 and 8633 page 2 from the program. Log onto the IRS web site at Follow the line-by-line instructions to complete the form. To obtain fingerprint cards to submit with Form 8633: Call Drake Support to request fingerprint cards. Contact a local police station to request fingerprint cards. Applications to become an authorized e-file provider are accepted year round. The IRS encourages all prospective EROs to apply as soon as possible as processing and background checks can take up to 45 days. PREPARE TO TRANSMIT 1. From the Menu Bar, go to Setup > ERO/State ERO Information. Verify that the transmitter information, EFIN and Password, are correct for the current year. The current Password is on the Drake software packing slip. Keep this slip for reference. In the Dial-up Connection field, press [F1] to select the Dial-Up Connection. Refer to Transmit and Receive later in this section to determine available options. In the Mode field, indicate when to use the dial-up connection. The preferred setting is O (the letter) - only when not already connected. 2. Calculate and select the returns to be transmitted (see Prepare the Transmission on page 193).
3 2003 DRAKE TAX SOLUTION Prepare the Transmission Connect to the Internet using an Internet Service Provider OR allow the program to connect using the selected Dial-Up Connection. See for more details on available transmission options. PREPARE THE TRANSMISSION Whether sending test returns or live returns, it is necessary to first open and calculate the returns, and view each return for any messages. If there is a red Message page with the return, any errors listed on that page must be corrected before the return is eligible for electronic filing. After all errors have been corrected, recalculate the return(s). Read any yellow Notes pages to ensure correct preparation. Review the EF Status Page generated with the return to ensure the desired EF transmission options. To override the program selections, return to data entry. Access the EF screen and make the desired sending selections. This screen is designed to be a complete override. For example, entering GA in the state-only field and leaving the 1040 selection box blank indicates the program should send ONLY the Georgia return. After making selection, recalculate the return and view the EF Status Page to confirm selections. When the return is calculated, a print file is created. A print file must exist before the return can be selected for transmission. From the Menu Bar, go to Setup > Options. On the Calculation and View/Print tab, go to the Number of days to store print files field. From the drop-down menu, select the number of days that these files remain in the system. After the desired returns have been calculated, prepare the transmission file as follows: 1. Select EF > Select Returns for EF on the Menu Bar. 2. A selection window opens, listing all recently calculated files that are eligible for electronic filing. Use the arrow keys to scroll through the list of returns. Click on column headers to sort returns by the different columns provided. 3. Use the [SPACE BAR] in the Console program, or mouse click in Windows to select or deselect the desired returns. See Review a Return from the Return Selector below for instructions on viewing and changing a return s transmission options. If transmitting directly to the IRS, batch returns by selecting returns for a single Service Center. The Service Center indicator for Direct to IRS filers is located in Setup > Equipment > Modems. If transmitting through Drake, returns for different IRS Service Centers can be combined. 4. After selecting the returns, In Windows, click [OK]. View the report listing all returns included in the transmission. Select the [PRINT] option to print the report. Click [EXIT] to close. In the Console program, press [ESC]. View the report listing all returns included in the transmission. Press [F3] to print. Press [ESC] to close.
4 194 Transmit and Receive 2003 DRAKE TAX SOLUTION REVIEW A RETURN FROM THE RETURN SELECTOR The FED column on the EF Return Selector displays the federal 1040 returns that are ready to send. To toggle the selection display in the Console version between federal returns and Electronic Transmitted Documents (ETDs), press [F6]. The ST column displays the state returns that are ready to send. The state column sorts the state returns by P (Piggyback)/ D (Direct State)/ S (State Only). If the state name is listed before the forward slashes (/), it is a Piggyback State. If it is listed behind the first forward slash, it is a Direct State. If it is listed behind the first two forward slashes, it is a State Only transmission. TRANSMIT DETAIL SCREEN The EF transmission options for each return can be reviewed and changed during the transmission process. To open the Transmit Detail screen: In the Console program, with the blinking cursor next to the SSN/EIN, press [TAB]. In Windows, double-click the desired return. When the Transmit Detail opens, the available choices are listed next to each field. Change the fields, if desired. In the Console program, press [ESC] to save the changes and select the return for transmission. Press [F1] to close the screen and not select the return for transmission. In Windows, click [OK] to save the changes and select the return for transmission. Click [CANCEL] to close the screen and not select the return for transmission. After preparing the transmission file, continue with the instructions for Transmit and Receive to send the returns. If the Setup Option Combine EF Steps is selected on the EF tab, the EF process will begin from the EF Selector screen. Click [OK]; the computer establishes a connection, transmit/receive and process acknowledgements. TRANSMIT AND RECEIVE MUST READ Do NOT transmit from more than one computer unless the program is installed on a dedicated server (the preferred network setup). Transmitting and receiving from more than one computer creates problems in the EF Database and may affect the ability to print checks. Transmitting tax returns and receiving acknowledgements requires a modem or other Internet connection to the computer. After selecting returns for a transmission file, they can be transmitted to Drake. When transmitting to Drake, two options are available:
5 2003 DRAKE TAX SOLUTION Transmit and Receive Preferred Method Internet electronic filing using any Internet Service Provider (ISP) (this includes dial-up, cable, dsl, T1, etc.) 2. Drake Dialer Direct modem-to-modem access to Drake (If there is no Internet Service Provider, install the Drake Dialer from Tools > Install Updates. This will allow e-filing to Drake, but it is a long distance call. Filing through the Internet is the preferred method.) The modem-to-modem connection (Drake Dialer) to Drake is NOT a toll-free call for those who are calling long distance. Drake users are encouraged to transmit returns through Drake. There are three advantages to this option: 1. Send piggyback returns for any State in a single transmission file Drake forwards all returns to the appropriate IRS Service Center(s). 2. When transmissions are not successful or acknowledgements are not received, Drake support is easily accessible. Our trained support personnel can access transmitted returns for troubleshooting. 3. Receive service packs during the EF transmission (Setup > Options > EF). MUST READ Do not attempt to transmit live returns until a successful test transmission has been completed. TRANSMIT/RECEIVE TO DRAKE For computers with XP systems, the firewall may need to be disabled if connecting is an issue. All returns transmitted through Drake are forwarded to the correct IRS Service Center. When the transmission is received by Drake, an immediate acknowledgement is sent to indicate a successful transmission. A P ack indicates a successful transmission of live returns. Any other message ack ( B ack) received when transmitting to Drake indicates a problem with the transmission(s) that have been attempted. (A T ack indicates a successful transmission of test returns.) After the IRS and/or the state receive and process the forwarded return, acknowledgements are sent to Drake, indicating whether the return was accepted or rejected. The acknowledgements are then forwarded to the ERO the next time he/she connects to Drake. IRS acks are usually processed within 24 hours. BEGIN THE TRANSMISSION 1. Select EF > Transmit/Receive on the Menu Bar. 2. The transmit screen opens, providing four possible options: Review, Delete Existing Files, Send/Receive, and Acks Only.
6 196 Transmit and Receive 2003 DRAKE TAX SOLUTION Send/Receive Use this option to connect and transmit the file, and to pick up Federal and State acknowledgements, bank product acknowledgements, check authorizations, and Service Packs needed to update the program. To review the transmission file before connecting, see Review below. 1. Click [SEND/RECEIVE] to continue in Windows, or press [F1] to continue in the Console program. 2. The Declaration Control Record opens. Click [PRINT] in Windows or press [F3] to print in the Console program. 3. Click [CONTINUE] in Windows or press [ESC] in the Console program. 4. The program connects and completes the transmission. It automatically disconnects from Drake after the transmission is complete. Acks Only Use this option to pick up Federal and State acknowledgements, bank product acknowledgements, check authorizations, and Service Packs needed to update the program. No files are transmitted to Drake. 1. Click [ACKS ONLY] to continue in Windows or press [F2] to continue in the Console program. 2. The program connects and retrieves the acknowledgements and any Service Packs. The program only retrieves installation files if the option is selected in Setup > Option > EF. It automatically disconnects from Drake after the transmission is complete. Review Use this option to review the transmission file and remove any returns before connecting to Drake. MUST READ The returns that are selected and highlighted will NOT transmit. The returns that are not selected will transmit. 1. To review the manifest, click [REVIEW] in Windows or press [F3] in the Console program. 2. To REMOVE returns from the transmission file: To select all, click [SELECT ALL] in Windows or press [F1] in the Console program. All returns will be highlighted to remove from the transmission file. To deselect all, click [UNSELECT ALL] in Windows or press [F2] in the Console program. All returns will transmit. For single returns, click to select or deselect returns in Windows; or press the [SPACE BAR] to select/deselect; or press [+] to select and [-] to deselect in the Console program. 3. Click [CONTINUE] in Windows or press [ESC] in the Console program to continue with the transmission.
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