The American Institute of Certified Public Accountants (AICPA) is calling on the IRS to create an automated, online process for taxpayers to update their name and address information, arguing the current paper-based system creates unnecessary delays, compliance risks, and administrative burdens.
Current paper process causes delays, risks
In an August 24 letter to IRS officials, the AICPA detailed problems with the current system for changing a name or address, which it described as “reliant on paper filings and manual processing.” For address changes, individuals must file Form 8822, Change of Address, and businesses must file Form 8822-B, Change of Address or Responsible Party – Business. To change a business name, a taxpayer must submit a signed letter that includes the entity’s employer identification number, its old and new legal names, and supporting state documentation.
According to the letter, processing these paper submissions takes six to eight weeks, and sometimes longer. These delays can cause the IRS to send time-sensitive notices to incorrect addresses, delay refunds and payments, and reject tax forms. The AICPA said the issues can lead to adverse consequences for taxpayers, including additional penalties, interest, lost appeal rights, and escalated collection activities.
The group also noted that even when taxpayers report a change on their annual income tax return, the IRS sometimes fails to update its systems accordingly.
AICPA urges fully automated system
The AICPA recommended that the IRS create a fully automated, electronic process that would let taxpayers and their authorized practitioners instantly submit and receive confirmation of name and address changes through their IRS online accounts. The proposed system would ideally be accessible through Individual Online Accounts (IOLA), Business Online Accounts (BOA), and Tax Pro Accounts (TPA).
To validate the changes, the AICPA suggested the IRS system could draw on authoritative government sources, such as the U.S. Postal Service National Change of Address database for address changes and state corporation commission or business registration databases for business name changes. This approach, the group said, would resolve a “significant majority” of requests automatically, allowing the IRS to resolve more complicated requests in days rather than weeks or months.
The system could also flag complex, unverifiable, or potentially fraudulent requests for manual review. The AICPA said the IRS could assign electronic status designations to those requests, such as “pending review” for low-risk changes and “additional verification required” for filings with high-risk factors, like multiple changes in a short period or signs of a compromised account.
Beyond helping taxpayers, the group said timely processing would advance the IRS’ own interests by ensuring notices reach a taxpayer’s correct last known address, reducing disputes over whether notice was properly issued, and freeing resources for higher-priority compliance and service activities.
AICPA proposes interim steps for relief
Acknowledging that a fully automated system will take time to build, the AICPA also proposed several interim steps to provide immediate relief. These recommendations align with the IRS’ Zero Paper Initiative and are consistent with prior AICPA testimony on IRS modernization.
The interim recommendations include letting taxpayers electronically submit change requests, supported by IRS tools such as the Document Upload Tool (DUT), before a fully automated process is built. The AICPA also suggested a status-tracking feature within IRS online accounts so taxpayers and practitioners can see that a request has been received, assigned, and processed.
Further, the group recommended reformulating a team of existing IRS personnel to exclusively process name and address changes and implementing a provisional process that temporarily updates a taxpayer’s account while the IRS performs any necessary verification, preventing operational disruptions for the taxpayer.
Take your tax and accounting research to the next level with Checkpoint Edge and CoCounsel. Get instant access to AI-assisted research, expert-approved answers, and cutting-edge tools like Advisory Maps and State Charts. Try it today and transform the way you work! Subscribe now and discover a smarter way to find answers.
