Payroll in Practice: 6.2.2025

Question: An employer is considering filing federal employment tax returns electronically. How are the electronic forms signed?

Answer: Any business entity that has employees is required to file employment tax returns with the Internal Revenue Service. The returns may be filed on paper or filed electronically through the Modernized e-File system for employment taxes, referred to as MeF.

While paper forms are filed directly with the IRS by the business, electronic returns are filed using IRS-approved software. The IRS does not provide this software. A business may either purchase filing software from a third party or hire an IRS-authorized provider that has the software necessary to file the returns. For employers choosing to purchase software, the IRS has published a list of software developers that have passed the assurance-testing requirements for electronic employment tax returns for tax year 2025.

Authorized providers have either purchased or developed filing software, which they use to file returns for employers. Providers include tax practitioners, payroll or service providers, reporting agents, Section 3504 agents, and intermediate service providers. A provider may simply transmit an employer-prepared return as an electronic return originator or prepare and transmit the return as a paid preparer.

Whether filed electronically or on paper, employment tax returns must be signed by an authorized signer. Individuals who may be designated as authorized signers are specific to the type of business entity. For sole proprietorship the authorized signer is the individual who owns the business.

For other entities, it must be a person who has knowledge of the employer’s affairs and can legally bind the employer. For a corporation -- including a limited liability company) treated as a corporation -- this could be the president, the vice president, or another principal officer duly authorized to sign. For a partnership --including an LLC treated as a partnership-- or unincorporated organization, it could be a responsible and duly authorized partner, member, or officer having knowledge of its affairs. For a single-member LLC treated as a disregarded entity for federal income tax purposes, it would be the owner of the LLC or a principal officer duly authorized to sign. For a trust or estate, it would be the fiduciary.

Forms may also be signed by a duly authorized agent of the taxpayer if a valid power of attorney has been filed.

Although manual signatures are generally required for paper forms, corporate officers or duly authorized agents may sign Form 941 by rubber stamp, mechanical device, or computer software program under an alternative method described in Revenue Procedure 2005-39. Officers or agents using an alternative signature are personally responsible for ensuring that the facsimile signature is affixed to the returns.

The filer must retain a letter, signed by the authorized officer or agent declaring, under penalties of perjury that the signature appearing on the form or forms is the signature adopted by the officer or agent and was affixed to the form by the officer or agent or at their direction. The letter must list each return signed by name and identifying number. This letter is not sent to the IRS unless specifically requested but is to be maintained for at least four years after the latter of the due date of the related tax or the date the tax was paid.

Four signature methods are available for MeF for employment taxes, including the reporting agent PIN, online signature PIN, practitioner PIN, and manual signature on Form 8453-EMP.

Reporting agent PIN signature: Form 8655, Reporting Agent Authorization, is used to appoint an authorized IRS e-file provider to prepare, sign, and e-file the returns. A reporting agent is an accounting service, franchiser, bank, or other entity that complies with Rev. Proc. 2012-32 and is authorized to prepare and electronically file employment tax returns for a taxpayer. Reporting agents, which are companies and not individuals, sign all of the electronic returns they file. The reporting agent receives a five-digit signature PIN from the IRS that is entered into the Reporting Agent PIN text box in the filing software. The filing agent also needs to have an EFIN, electronic filing identification number, prior to submitting Form 8655.

Online Signature PIN: This method is used by an authorized signer to sign e-filed returns when using purchased third-party software. The signer completes the Form 94x online signature PIN process provided in the software to become an IRS authorized signer of the company’s 94x tax returns. The IRS provides a 10-digit PIN to sign these returns. It may take up to 45 days to receive the PIN, which should not be shared.

Practitioner PIN signature: This method uses Form 8879-EMP, E-file Authorization for Employment Tax Returns, when an employer and their Electronic Return Originator or preparer agree to sign the tax returns with an employer, self-selected, five-digit electronic filing PIN. This form is signed by the authorized signer and retained by the ERO or preparer as the alternative signature method letter required under Rev. Proc. 2005-39.

Form 8453-EMP signature: Under this method, the authorized signer manually signs Form 8453-EMP, E-file Declaration for Employment Tax Returns. The signed form is scanned and saved as a PDF file. The transmitter will upload this PDF file to the software as an attachment to the electronically filed return. There are no PINs involved in this option.

Since January, employers may use MeF to file amended employment tax returns on Forms 940, 941-X, 943-X, 944-X and 945-X. Forms 8453-EMP and 8879-EMP may be used for signatures for electronically filed employment tax returns on Forms 940, 941-X, 943-X, 944-X and 945-X as well as all forms in the 940, 941, 943, 944, and 945 series of forms.

This column does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., or its owners.

Author Information
Patrick Haggerty is the owner of a tax practice in Chapel Hill, North Carolina, and an enrolled agent licensed to practice before the Internal Revenue Service. The author may be contacted at phaggerty@prodigy.net.

Do you have a question for Payroll in Practice? Send it to phaggerty@prodigy.net.