Re: what is magnetic media

I don't know, but you are correct that the bill actually mandates "magnetic media." I looked up the final version that Obama signed yesterday. That would also rule out USB flash-drives and flash-cards, as those are silicon-based non-magnetic media. I think Congress was trying to be smart but designated the wrong thing.

I plan on raising this issue in my tax update class in 3 weeks from tomorrow. However, it is clear that the language used EXCLUDES electronic wire transmission - as there is no medium storing the data, and would also exclude CD/DVD media (since they are optical, not magnetic). I also noted no provision for the Secretary (or his designate) to permit other types - ONLY "magnetic media" is permitted.

There are probably some income tax returns that cannot fit on a floppy disk. What are we supposed to do with those - send a hard drive?

Unbelievable. UFB. Is this a hoax, a prank to see who's in the 21st century yet? Can Congress possibly be so out of it? "Magnetic Media" is how payroll information was required to be sent to the Social Security Administration. In West By-God Virginia. In a previous

*millennium* yet!!!

It is a puzzlement, to be sure.

The inclusion of the term magnetic media was evidently by some staff member who didn't realize that even that is not done these days.

(However I was looking in back room last week for a certain 3 1/2 inch floppy perchance it had an old spreadsheet on it, and it did. I have about 30 of these old floppies on hand just in case they're need per this new bill.) (grin)

The other hangup with the language used speaks of tax preparers who file tax returns. Now we all know that only taxpayers "file" returns, and that certain tax preparers who are also ERO's accept client signatures on documents which allow them to transmit returns to IRS; NOT to file them.

ChEAr$, Harlan Lunsford, EA n LA

| > > > (3) SPECIAL RULE FOR TAX RETURN PREPARERS | > >

| > > > (A) IN GENERAL- The Secretary shall require than any | > > > individual income tax return prepared by a tax return preparer be | > > > filed on magnetic media if-- | > >

| > > > (i) such return is filed by such tax return | > > > preparer, and | > >

| > > > (ii) such tax return preparer is a specified | > > > tax return preparer for the calendar year during which such return is | > > > filed. | >

| > > Magnetic media means a floppy disk (including the 3.5" hard-cased | > > floppies), or 9T-tape. A wire/modem transfer has no magnetic medium and | is | > > therefore excluded. This might include the older 5.25" floppies, but | > > usually doesn't include the oldest 8" floppies unless it specifically | says | > > so | >

| > This sounds ridiculous. Hardly anyone I know uses 3.5" floppies any | > more. Most everything is on hard drives, and sometimes the hard drive | > is on a remote computer. | >

| > > If they wanted "Internet or phone" transmissions, they would have said | "by | > > electronic means" instead of "on magnetic media." | > >

| > > This language actually KILLS "e-file" that we've had since 1990 (for | 1989 | > > returns in pilot program areas). | >

| > Why would they want to kill eFile? Isn't that what everyone pretty | > much uses these days? | | I don't know, but you are correct that the bill actually mandates "magnetic | media." I looked up the final version that Obama signed yesterday. That | would also rule out USB flash-drives and flash-cards, as those are | silicon-based non-magnetic media. I think Congress was trying to be smart | but designated the wrong thing. | | I plan on raising this issue in my tax update class in 3 weeks from | tomorrow. However, it is clear that the language used EXCLUDES electronic | wire transmission - as there is no medium storing the data, and would also | exclude CD/DVD media (since they are optical, not magnetic). I also noted | no provision for the Secretary (or his designate) to permit other types - | ONLY "magnetic media" is permitted. | | There are probably some income tax returns that cannot fit on a floppy | disk. What are we supposed to do with those - send a hard drive?

I still have 9-track tape drives if anybody wants to go that route. I can even go as low as 800bpi density for maximum backwards compatibility...

Dan Lanciani ddl@danlan.*com

Unfortunately, it's NOT. HR 3548 - now PL 111-92, section 17.

Tax year 2009 (timely filed including extensions) is the last year of e-file.

After December 31, 2010, ALL income tax returns prepared by a preparer who does 11+ per calendar year must be filed on magnetic media. I read this as including PAST year [delinquent] returns and possibly amended returns as well. There are no waivers. There is no discretion, not even by the Secretary (or his designate).

It> | > > > looks like starting Jan/2011, all tax returns prepared by preparers> | > > > have to be eFiled -- I guess that's what "magnetic media" means. What> | > > > is the penalty is the tax preparer does not comply? What if the> | > > > federal return cannot be eFiled? What if the client chooses to not> | > > > use eFile?> | > >

specifically

...But do you have a working IBM/360 series mainframe to control the tape drive from?

(A system 370, 3080-series, or 9370 will do just as well, and so will their clones; e.g. Amdahl 680).

Oooh, I worked on a 9370 for a project once! Not a commercially successful product for IBM, as I recall...

-Mark Bole

Or for that matter a CDC or DEC or VAX... :)

I still have the cases of several of the old Philco 2000 7-track drives as server racks... :)

(snip)

| > | There are probably some income tax returns that cannot fit on a floppy | > | disk. What are we supposed to do with those - send a hard drive? | >

| > I still have 9-track tape drives if anybody wants to go that route. | > I can even go as low as 800bpi density for maximum backwards | > compatibility... | | ...But do you have a working IBM/360 series mainframe to control the tape | drive from?

No, but I have other working machines to control the tape drives. N.B. I'm not offering to do data processing for you. I will simply put your data on the tape in whatever format (within reason--I can't do unlimited length records easily anymore) you specify.

Dan Lanciani ddl@danlan.*com

spam+ snipped-for-privacy@bde-arc.ampr.org

I plan on using floppy disks. When I run out of 3.5"'s, I'll start using

5.25"'s.

"HLunsford" wrote

And so....you'll auction them off? On e-Bay maybe?

And will they sell for cash or scotch?

"D. Stussy" wrote

Just be glad it's not applicable to information returns.

Wouldn't you hate to get all those W-2 and 1099 forms on floppies too?

And then, I take it to mean that we don't have to do this for the corporate tax returns, 990's, 5500's. Just individual returns.

Actually that's a slight misreading of the statute. The final legislation as a public law is not yet available on congress's gpo website. But here is what appears to be the final version after passed by Congress:

What it says, among other things, is that under certain circumstances, "The Secretary shall require than any individual income tax return prepared by a tax return preparer be filed on magnetic media...."

In other words the treasury is required to promulgate regulations concerning "electronic returns." I believe courts would uphold any regulation that interprets "magnetic media" to mean electronically stored data.

Do you think the IRS still has tape machines to read them?

Chip

I've heard their computers are using 1962 technology.

Why? That's how I used to send them in the 1990's. I even have one leftover "Form 5064" - media label.

Not quite: 1041s - trusts & estates too, as well as 1040s.

And in the following paragraphs, those circumstances are defined as a preparer who expects to have prepared more than 10 income tax returns in a calendar year.

The word "electronic" does not appear in the text anywhere.

"Magnetic media" has a very specific definition. If they wanted e-file, they would have said "by electronic means", not "on magnetic media."

At Martinsburg, WV, and perhaps some of the former "service centers."

Though it may not be on point for this discussion, the Service has previously defined magnetic media to include electronic filing.

[4830-01-p] Published January 12, 2005 DEPARTMENT OF THE TREASURY Internal Revenue Service (IRS) 26 CFR Parts 1 and 301 TD 9175 RIN 1545-BE19 Returns Required on Magnetic Media AGENCY: Internal Revenue Service (IRS), Treasury. ACTION: Temporary regulations. SUMMARY: This document contains temporary regulations relating to the requirements for filing corporate income tax returns and returns of organizations required to file returns under section 6033 on magnetic media pursuant to section 6011(e) of the Internal Revenue Code (Code). The term magnetic media includes any magnetic media permitted under applicable regulations, revenue procedures, or publications, including electronic filing.