Internal Revenue Service Moves Ahead With Plan For Secure Electronic Tax Filing

EDP Weekly's IT Monitor, Sept 14, 1998

VeriSign To Provide Digital Certificates,

Public Key Infrastructure For IRS ETA Pilot

VeriSign Inc., the Mountain View, Calif., provider of public key infrastructure (PKI) and digital certificate solutions, has been awarded an Internal Revenue Service (IRS) contract for an Electronic Tax Administration (ETA) PKI pilot that will enable secure e-mail and electronic filing of individual tax returns. The IRS will use VeriSign's OnSite product to deploy the fully operational PKI.

The contract also contains an option for an e-filing pilot for IRS employees under which VeriSign would provide its Onsite digital certificate and PKI infrastructure in conjunction with tax-filing applications from partners Intuit and UWI.Com.

Widespread use of ETA would allow IRS to minimize its reliance on paper-based signatures and increase the number of taxpayers filing their returns electronically.

"We're committed to providing the American taxpayer the convenience and ease-of-use of electronic filing while maintaining the privacy and integrity of individual taxpayer data," says Steve Holden, national director of Electronic Program Enhancement at IRS. "Gaining familiarity with PKI will help us determine how this technology can be applied to electronic transactions with taxpayers."

VeriSign's digital certificates provide significantly stronger security for access control than user names and passwords; serve as non-forgeable electronic identity badges for users to access government services and benefit information online; and provide confidentiality and authentication of internal and external communication including e-mail, electronic form and a broad variety of other applications.

Currently, most taxpayers who submit their returns electronically must also file a hard copy with a handwritten signature to authenticate the return. With the move to digital signature applications, the IRS will for the first time offer taxpayers a true electronic filing option.

VeriSign was awarded the two-year contract as the sole provider of digital signatures and infrastructure for the IRS ETA PKI pilot to test and evaluate the use of digital signature applications. Under the pilot, VeriSign will provide the full PKI functionality required to issue and manage the IRS ETA digital certificates. Pilot roll-out will begin in October.

"We're proud to partner with the IRS in reengineering the way taxpayers file their annual returns," says Nick Piazzola, VP of VeriSign's Federal Markets Division. "The IRS joins a growing number of corporate and government customers choosing VeriSign's enterprise PKI solution to secure their intranet, extranet and Internet business applications."

Initial Phase 1 applications will focus on signature-based secure e-mail with up to 200 IRS employees participating. Phase 2 will include an expanded PKI evaluation with an option to implement up to two e-file applications from VeriSign partners Intuit or UWI.Com. Up to 5000 IRS employees will participate in the Phase 2 pilot, using the technology to file their 1999 tax returns. n