Accounting Digital Signature Integration: Why and How to Use eFileCabinet’s
Did you know that the IRS now accepts digital signatures on forms 8878 and 8879? That means big gains for those who chose to use them during tax season.
In this post, we’ll cover two important topics, and at the end of each topics that will help you effectively use the accounting digital signature integration eFileCabinet has. With this great tool, you’ll be able to lighten your tax load significantly during tax season.
Given that 89% of technology users use their mobile phones throughout the day, it’s important to understand how digital signatures function in the mobile space, especially when it comes to productivity.
What is Required for a Valid Digital Signature?
To begin, there are two Acts that establish the legality of electronic signatures in the US: The Electronic Signatures in Global and National Commerce Act (ESIGN, 2000), and the Uniform Electronic Transactions Act (UETA, 1999). FINRA, SEC, and the IRS all base their requirements for digital signatures on the ESIGN Act, making it the most important of the two.
Although eIDAS is another significant ruling in the European Market on digital signatures, we will not focus on that in this discussion as the majority of our customer base is in the Americas.
Sometimes these governing bodies and authorities will offer their own recommendations in light of these laws, but the ESIGN Act is the most important part of accounting digital signature integration.
Both ESIGN and UETA establish that electronic records and signatures carry the same weight and legal effect as traditional paper documents and handwritten signatures stating: “A document or signature cannot be denied legal effect or enforceability solely because it is in electronic form.”
This means that whether you make a mark or a checkbox or enter in some characters to prove you’re not a robot with a keyboard, or you use your finger on a signing stylus/touch screen, it is legally valid and binding just as much as any traditional paper document would be.
At the advent of the 21st century, the legalese regarding this terminology was very open to interpretation as the technology was very new, and businesses were uncertain how to navigate the landscape without any legal hang ups.
However, accounting digital signature integration changes all this.
Although it is not required for digital signature integration, one of the best benefits of accounting digital signature integration is the fact clients don’t have to print out PDFs of documents you send them as signatures and then file them away in an unsafe place. This makes things a lot easier for your clients.
Or then have to figure out a place to print it out, scan it, and then fax it back to you. Really, the headaches of not having accounting digital signature integration are baffling when compared to what the technology itself can do.
It’s funny to think that amendments to laws pertaining to accounting digital signature integration were passed in the age of the Clinton Administration, yet the benefits these laws afford remain relatively untapped by the marketplace.
But back during that time, all that was available in the accounting digital signature integration world was “box checking” as one does when installing a piece of software. This is technically an electronic signature.
After this came the “type to sign” era, but now we are in the biometric era of accounting digital signature integration, which is typified by wet ink replicas.
Accounting Digital Signature Integration Recording Requirements
To be made applicable to the context of the signature and be upheld by the law, the accounting digital signature integration must record the following things:
Digital image of the signed form
Date and time of the signature
Taxpayer’s computer IP address and login identification/user name
Identity verification: the taxpayer’s knowledge based authentication passed results (utilizing RightSignature custom-specified password feature).
Method used to sign the record; or a system log; or other audit trail that reflects the completion of the electronic signature process by the signer.
Accounting Digital Signature Identity Verification Requirements
The Internal Revenue Service (IRS) specifies that “the electronic signing process must be associated with a person, and accordingly, ensuring the validity of any electronically signed record begins with identification and authentication of the taxpayer.”
This means that, to comply with identity verification requirements, the ERO must establish the taxpayer’s name, social security number, location of residence, and the date of birth of the taxpayer.
As referenced above, this would require the taxpayer to use the custom-specified password feature as its administered by Rightsignature’s accounting digital signature integration. Although a knowledge based question is not legally mandatory for verification or authentication, it is one of the document recommendations made by legislative and governing bodies.
How to Use Digital Signature Integration with eFileCabinet
Visit the RighSignature login page. Your previous document signings will be visible in the HTML previewer. Click the “send a document” icon at the top, and then it will give you a formulaic way of tailoring your accounting digital signature.
After selecting the document of choice, you can specify the people who should be involved with the document. At the bottom, you can show the description of the document, which will fill the recipient in about any relevant details regarding the signature.
One of the coolest things about the RightSignature integration is the fact that it lets the creator of the document specify where the signature box should appear on the document. This cues the signer in on where they should sign, drawing immediate attention only to the areas of their interest. This not only expedites the document turnaround process, but also simplifies the document signer’s experience.
Tracking Mechanisms for Accounting Digital Signature Integration
Users can pre-build signature certificates for your clients with this feature. And this also prevents the need to drag the signature block out every time you use digital signature.
That means all your W-2s can have pre-assorted text blocks for signing so you don’t have to redo the process every time you send a new form to an existing customer.