Chapter 1

Introduction

The North Carolina Department of Revenue will accept electronically transmitted individual income tax returns beginning on January 12, 2007.  This transmission will be in conjunction with the Internal Revenue Service’s (hereafter referred to as the IRS) existing e-file Program.  The taxpayer’s state return can be filed with his/her federal return or the state return can be filed separately.  The program for the 2005 tax year was very successful.  NCDOR has filed over 2 million returns through the cooperative program.

The North Carolina Department of Revenue (NCDOR) requires all tax professionals to be accepted into the Federal program before they can participate in the Federal/State e-file Program.  Tax professionals don’t need to submit an application to NCDOR to be accepted into the e-file program. Nor does the tax professional need to submit a copy of the federal acceptance letter to participate in the e-file program.

The North Carolina Handbook is to be used with IRS Publication 1345, Handbook for Authorized IRS e-file Providers of Individual Income Tax Returns and IRS Publication 1345A, Filing Season Supplement for Authorized IRS e-file Providers of Individual Income Tax Returns.  The North Carolina Handbook sets forth those items that are specifically unique to NCDOR.  All rules, regulations, and requirements specified by the IRS governing tax preparers, transmitters, and originators of returns are in effect for NCDOR.

The IRS provides detailed instructions on hardware, transmission procedures, policies, etc. in Publication 1345 and Publication 1345A.  We encourage participants to study and become familiar with these documents.

The North Carolina Handbook is also available on NCDOR’s website.  The website address is:  www.dornc.com.  The NCDOR’s Electronic Filing Applicant Database is accessible to taxpayers on the website to assist them in locating a tax professional in their area that participates in the Federal/State e-file Program.