Yes, really.
The IRS recently replaced IRS2Go with a new IRS app that lets taxpayers do more from their phones. You can check a refund, view available balances, make payments, see certain notices and letters, access tax records and transcripts, and retrieve an Identity Protection PIN.
For an agency where “please fax this to us” is still a perfectly normal sentence, this feels like progress.
But there is an important catch for startup founders: the new app is primarily an individual taxpayer tool. It does not currently give you access to your company’s IRS Business Tax Account.
And if your startup is foreign-founded, even accessing the IRS’s separate business tools may not be as straightforward as you would expect.
01For individuals, the app is genuinely useful
Some features do not even require signing in. Taxpayers can check refund status and make certain payments without logging into an IRS account.
Sign in, and more becomes available, including balance information, payment activity, select notices and letters, tax records and transcripts.
International taxpayers are not automatically excluded either. The IRS allows taxpayers with international addresses to use Individual Online Account.
There is an important limitation, though.
To verify your identity for IRS online accounts and services, you generally need a Social Security number or Individual Taxpayer Identification Number, along with a government-issued photo ID.
So a foreign founder with an ITIN may be able to use the IRS’s individual digital tools.
A foreign founder with neither an SSN nor an ITIN has a different problem.
The company’s EIN does not take the place of the founder’s personal tax identification number for identity verification.
02What about your startup?
This is where things get more interesting.
The IRS also has a separate Business Tax Account, and it has become substantially more useful. C corporations are among the entities that can now use it. Depending on the entity and the person’s role, users can view balances, make payments, retrieve transcripts, see IRS notices and access other business tax information.
One relatively small feature may save founders a surprising amount of aggravation: eligible users can download an EIN verification notice directly from the Business Tax Account.
Anyone who has ever gone looking for an EIN letter from three years ago knows this is more exciting than it sounds.
But don’t go looking for your company’s Business Tax Account inside the new app just yet. The app currently extends selected Individual Online Account features. Business Tax Account remains a separate service.
03Foreign-founded startups are where it gets interesting
Consider a fairly common startup structure.
A founder lives outside the United States. They form a Delaware C corporation. The corporation has an EIN. The founder is its CEO, but the founder does not have a U.S. SSN or ITIN and is not on U.S. payroll.
You might reasonably assume that the CEO can simply create an online account for the corporation.
Not necessarily.
For a C corporation, a Designated Official seeking full Business Tax Account access generally must be an officer or managing member, be a current employee who received a W-2 for the most recent tax filing year, and have authority to legally bind the business.
There is another hurdle. IRS identity verification requires an SSN or ITIN. Even a person added as a Designated User must have an SSN or ITIN.
That creates an odd situation.
A foreign founder can own and run a U.S. corporation. The corporation can have an EIN, file U.S. tax returns and have U.S. tax obligations. Yet the founder may still discover that getting into the company’s shiny new online IRS tools isn’t so simple.
The technology may have caught up faster than the international startup fact pattern.
04So, is the new IRS app worth using?
For individuals, yes. Being able to check a balance, confirm a payment, retrieve records or read certain IRS correspondence from a phone is a meaningful improvement.
For businesses, the bigger development may actually be the continuing expansion of the separate Business Tax Account.
But “the IRS has an online account” and “I can access my company’s IRS account” are not the same thing.
For startup founders, access can depend on the type of entity, the founder’s U.S. tax identification, their role in the company, whether they are on payroll and who else has authority to act for the business.
Foreign-founded companies are particularly likely to encounter the gaps between those rules.
The IRS has entered the app era. But the answer to whether you can actually use all of its new digital tools remains reassuringly familiar:
It depends.
This article is general information, not tax or legal advice. The rules are fact-specific, change over time, and depend on details unique to your company. Talk to us about how they apply to your situation.