Secrets of Outsourcing, QuickBooks Outsourcing, ProSeries Outsourcing, Internal Revenue 7216

Dale Carnegie wrote How to Win Friends and Influence People more than 70 years ago. This short book, How to Win Friends and Influence People, is even more valuable today than when I read it in the 1970s.

Secrets of Outsourcing, QuickBooks Outsourcing, ProSeries Outsourcing, Internal Revenue 7216

I did extensive research on the new Internal Revenue 7216 regulations and related discussions. I passed difficult long ago. I was asking if anyone knew any Secrets of Outsourcing that would make it POSSIBLE for anyone to use a foreign tax preparer with QuickBooks Outsourcing, ProSeries Outsourcing, Lacerte Outsourcing or TurboTax outsourcing, due to new Internal Revenue 7216 Regulations.

As you know, the new Internal Revenue 7216 Regulations (effective in 2009) make us mask social security numbers in both source documents and tax returns. The Internal Revenue 7216 Regulations often refer to 1040 series tax returns. However, I most respectfully submit that the foreign social security number disclosure prohibition also seems to affect 1120S and other returns, as they include such social security numbers, Unless we can disclose these  numbers, to foreign tax preparers, for QuickBooks Outsourcing, ProSeries Outsourcing, Lacerte Outsourcing or TurboTax outsourcing, due to the new Secrets of Outsourcing Internal Revenue 7216 Regulations, why should we bother with even the difficult consent provisions needed for QuickBooks Outsourcing?



For eight year my Secrets of Outsourcing got client consents to outsource, due to the big savings with QuickBooks Outsourcing, TurboTax Outsourcing, ProSeries Outsourcing and Lacerte Outsourcing. However, due to new Internal Revenue 7216 Regulations, we need separate forms or web pages for the use and for the disclosure of information to foreign tax preparers. We may use QuickBooks passwords to hide employee and owner social security numbers in payroll, but foreign accountants and tax preparers often must enter many documents with social security numbers in QuickBooks outsourcing files. I respectfully submit that very few U.S. tax preparers will soon let them do this due to the new Internal Revenue 7216 Regulations.



Intuit apparently has no plan to conceal social security numbers for QuickBooks Outsourcing, ProSeries Outsourcing, Lacerte Outsourcing, TurboTax outsourcing or related programs this year, though it has long been aware of the problem. This is from a Document eSort Pre-Release Software License Agreement, now in Google at Instead of commenting on procedures for masking social security numbers it says:


2.3 To the extent that Tester provides any information, including but not limited to health information, to Intuit or its Representatives (as defined below), Tester warrants that (i) Tester has or will obtain any and all of Tester’s client (“Client”) consents and authorizations in compliance with IRC 7216 and any other applicable law, regulation and governmental licenses as required to allow Intuit to access and use Client information provided by Tester to enable Intuit to test, improve and enhance the types of data and services provided by this software. Information may include, but is not limited to, Client’s personally identifiable information, financial records, 1099 and W-2 information (ii) Tester is providing only Tester’s own information or the information of others which Tester is authorized to provide on their behalf to third parties; and (iii) the use of such information by Intuit and its Representatives will not infringe or misappropriate the intellectual property rights or otherwise violate the rights of any third parties.



This lack of an Intuit change for this surprises me. The U.S Department of Commerce shows Foreign Insourcing adding U.S. jobs, by more than Foreign Outsourcing reduces U.S. jobs, since 1973. From 1973 to 1977 both numbers grew about 15 times, as a percent of Gross Domestic product By 2006 one estimate of the world trade in services was $2,711 billion Much of this industry uses Intuit products. Google already has 360,000 web pages for QuickBooks outsourcing, 52,000 for TurboTax outsourcing, 24,000 for ProSeries outsourcing and 7,000 for Lacerte outsourcing. Without the new Internal Revenue 7216 this would quickly increase, now that QuickBooks does accounting for more than 100 foreign currencies.  


This Intuit lack of a change also surprises me because it seems to violate the Intuit Mission and Operating Values: “We Care And Give Back” It is clear that much foreign outsourcing involves those who are very needy. I suspect these new IRS rules, coupled with continued Intuit inaction, will have devastating economic and educational consequences to many who can least afford it. Based on my long involvement with Secrets of Outsourcing I know it is an excellent way to make friends where our country needs them most Thomas Friedman clearly shows, in The Other Side of  Outsourcing, stopping this can only benefit our enemies



SurePrep, Thomson UltraTax, CCH (ProFx, ATX, TaxWise) and GruntWorx are addressing this. Therefore, many accountants (including this ex-member of the ProSeries Advisory Council and the entire outsourcing industry) may very soon drop Intuit tax programs for the first time.




  Mike Block-QuickBooks CPA, 954-903-7250 24/7  

        Intuit pays me to make QuickBooks better!,



—–Original Message—–

From: James Zachman []
Sent: Sunday, December 14, 2008 12:17 PM
To: Mike Block CPA
Subject: RE: Internal Revenue Code 7216


Mike – see – looks like it will be difficult going forward.


“From a practical standpoint, there are two areas a firm needs to be concerned with if they’re outsourcing offshore. They need to get the consent signed once a year, and they need to worry about how to mask the SSNs. It has to be masked in both the scanned images of the source document as well as the pro-forma tax file,” he explained. “From the accounting firm perspective, they need to be convinced the outsourcer has a reliable process in place if they’re going to be outsourcing offshore. If the outsourcing is done inside the U.S., then this doesn’t apply — you don’t need a consent and there’s no need to mask the SSNs.”



Wyle noted that offshore outsourcing has been more popular than onshore outsourcing because it is less expensive. “However, we expect that balance to change this coming year,” he said.



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Fastest, easiest, accurate, low-cost QuickBooks! Intuit - QuickBooks CEO, "You're fantastic Mike! Absolutely fantastic!" Tax fighting CPA.

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