IRS ISSUES NEW PREPARER RULES.

The IRS replaced its proposed regulations regarding the retention of preparer-signed tax documents with final regulations, effective July 18. The new Treasury Regulation is Sec. 1.6695.1.

Effective immediately, tax preparers have two methods for retaining preparer signatures on tax returns or claims that are electronically filed:

* The preparer (or the preparer's firm) can keep an originally-signed tax return or claim; or

* The preparer (or the preparer's firm) can keep a photocopy of the signed return or can use an electronic storage system to retain a copy of the preparer-signed return.

Requirements set out in Rev. Proc. 97-22 describe the accepted method for electronic storage of documents.