The IRS will now give you a signed statement of whether you are square with it, and an installment agreement does not read as compliant

Anyone asked to prove they are current with the IRS has until now had to order a transcript and hope the person reading it could interpret one.

The IRS said on Thursday that it has launched a digitally authenticated Tax Compliance Report, available on demand through a taxpayer's Individual Online Account. The report carries an IRS-issued digital certificate embedded in the downloaded file, so a bank or an agency receiving it can check that it came from the IRS. Individuals and sole proprietors get Letter 6201. Businesses get Letter 6574.

By providing a secure, digitally authenticated report, the IRS is making it easier for taxpayers to access and share important information while protecting privacy and data integrity.

That is the agency's chief executive, Frank J. Bisignano, quoted in the release.

Three statuses, and the middle one is the interesting one

The report returns compliant, noncompliant, or compliance issue. Compliant means every return filed and every tax paid on time, with no overdue return and no unpaid debt. Noncompliant means an overdue return or an unpaid tax debt as of the date on the report.

The third category is the one worth reading closely, because it captures people who are paying. A taxpayer working through a balance under an installment agreement lands there. So does a taxpayer with a history of filing or paying late, a taxpayer who was assessed a civil fraud penalty even where it has been paid in full, and a taxpayer whose balance is under administrative or judicial review.

The windows

The report looks back a set distance on each item. Late payments of federal income, employment or excise tax are shown for the past four tax years. Returns not filed, or filed late, are shown for the past six. Fraudulent failure to file and civil tax fraud penalties are shown where they were assessed within five years.

What it leaves out is as deliberate as what it includes. The report does not show income, dependents or filing status, and it does not show corporate or partnership tax information. A sole proprietor who is required to file excise or employment tax returns will see delinquent business returns on it.

Two practical traps

Timing is one. The IRS puts the posting lag at roughly two weeks for a payment and four to six weeks for a return, so a taxpayer who filed or paid recently may pull a report that has not caught up.

The file itself is the other. Only the original downloaded PDF carries the embedded certificate. A screenshot, a scanned copy, or a file made with Print to PDF is not the authenticated document, and the agency says some browsers and mobile viewers will not display the certificate at all, which does not mean it is missing. Digital authentication is available only through Individual Account for now.

A separate document covers federal contracting. Letter 6575 is a tax certificate for award use, and it reports whether a business has a seriously delinquent tax debt as defined by the Consolidated Appropriations Act of 2019.