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In a landmark decision, the Internal Revenue Service (IRS) has officially made permanent the temporary change implemented during the COVID-19 pandemic, allowing electronic signatures on various forms, documents, and returns. Initially introduced on August 28, 2020, as a response to the pandemic, the IRS temporarily permitted electronic signatures on specific forms traditionally required to be signed manually. This policy, initially set to expire on December 31, 2020, was extended multiple times, with the most recent extension pushing the deadline to October 31, 2023.
In an official statement released on October 17, the IRS incorporated the temporary policy, outlined in guidance memorandum NHQ-10-1121-0005, into the Internal Revenue Manual (IRM) under Section 10.10.1. The updated IRM, specifically Exhibit 10.10.1-2, provides a comprehensive list of forms for which electronic signatures are now deemed acceptable. Notably, this policy retroactively applies to forms signed on or after August 28, 2020.
The IRS’s decision to make electronic signatures a permanent feature comes after strong advocacy from various quarters, including the American Institute of CPAs (AICPA), which has long championed the cause. The move towards embracing digital signatures is not entirely new; it finds its roots in the IRS Restructuring and Reform Act passed by Congress in 1998. This legislation called on the Treasury to establish procedures for accepting digital or electronic signatures.
This significant development marks a transformative shift in IRS procedures, streamlining processes and offering greater convenience to taxpayers, especially after the digital transformation across various sectors.

Source (IRS News).