Tax firm glossary
46 terms a tax office meets when it collects documents, talks to clients, e-files and protects data. Plain English, with the IRS or FTC source for each one.
Last reviewed: October 16, 2026.
All terms
A
- A2P 10DLC(Application-to-person messaging over 10-digit long codes)A2P 10DLC is the US carriers' registration system for business texting from ordinary 10-digit numbers. Unregistered traffic is filtered or blocked.
- AES-256 encryptionAES-256 is the widely used encryption standard with a 256-bit key. At rest means stored files are encrypted; in transit means data is encrypted while it moves.
- AI voice agentAn AI voice agent is software that answers or makes phone calls with a synthetic voice, understands the caller, follows the firm's rules, and hands off to a person.
- Assurance Testing SystemThe Assurance Testing System (ATS) is the IRS test environment where software developers and transmitters prove their software before filing live returns.
- Automated tax status updateAn automated tax status update is a short text, WhatsApp or email sent when a client's return moves to a new stage, so the client hears from the firm before calling.
B
C
- CAF number(Centralized Authorization File number)A CAF number is the IRS file number assigned to a representative the first time a Form 2848 or 8821 naming them is processed, and used on every later form.
- Certifying Acceptance AgentA Certifying Acceptance Agent (CAA) is authorized by IRS agreement to help applicants get an ITIN and to certify their identity documents so originals stay home.
- Circular 230Circular 230 is the Treasury regulation on practice before the IRS for attorneys, CPAs, enrolled agents and other practitioners: competence, diligence, fees, conduct.
- Client portalA client portal is a secure, password-protected website where clients upload documents, download returns, sign forms and message the firm instead of using email.
D
E
- EFIN(Electronic Filing Identification Number)An EFIN is the IRS number a firm receives when it is accepted into the IRS e-file program. Without one, the firm cannot e-file client returns.
- Electronic signatureAn electronic signature is a valid way to sign without ink. The IRS accepts e-signatures on Form 8879 under Publication 1345 and on a list of other forms it publishes.
- Engagement letterAn engagement letter is the written agreement between a tax firm and a client that sets the scope of the work, each side's duties, fees and timing before the work starts.
- ERO(Electronic Return Originator)An ERO is the Authorized IRS e-file Provider that starts the electronic filing of a return: it collects the return, gets the signature and submits it.
- ETIN(Electronic Transmitter Identification Number)An ETIN identifies the party that transmits returns to the IRS e-file system. Most firms never need one, because their software vendor is the transmitter.
F
- Form 2848(Power of Attorney and Declaration of Representative)Form 2848 is the IRS power of attorney. It authorizes an eligible representative, such as a CPA, enrolled agent or attorney, to act for the taxpayer before the IRS.
- Form 8821(Tax Information Authorization)Form 8821 lets a client authorize a firm to receive and inspect their confidential tax information for the years listed. It does not allow representation.
- Form 8867(Paid Preparer's Due Diligence Checklist)Form 8867 is the due diligence checklist a paid preparer completes when a return claims the EITC, child or dependent credits, the AOTC or head of household.
- Form 8879(IRS e-file Signature Authorization)Form 8879 is the client's signed permission for the ERO to e-file their individual return. It is signed before transmission and kept for three years.
- Form W-7(Application for IRS Individual Taxpayer Identification Number)Form W-7 is the application for an ITIN. It is usually filed with a federal tax return and must be supported by original identity documents or certified copies.
- FTC Safeguards RuleThe FTC Safeguards Rule requires tax preparers, as financial institutions, to run a written security program: encryption, multi-factor authentication, vendor oversight.
G
I
- IP PIN(Identity Protection PIN)An IP PIN is a six-digit number known only to the taxpayer and the IRS. A return filed without the current IP PIN is rejected, which blocks identity-theft filings.
- IRS Publication 1345(Handbook for Authorized IRS e-file Providers of Individual Income Tax Returns)Publication 1345 is the IRS rulebook for e-file providers of individual returns: identity verification, signatures, record keeping, advertising and when to transmit.
- IRS Publication 4557(Safeguarding Taxpayer Data)Publication 4557 is the IRS guide for tax professionals on safeguarding taxpayer data: a checklist of safeguards and the steps to take after a data theft.
- IRS transcriptAn IRS transcript is a summary of what the IRS has on file for a taxpayer: return data, account activity, or the wage and income forms employers and banks reported.
- ITIN(Individual Taxpayer Identification Number)An ITIN is a nine-digit tax processing number the IRS issues to people who must file or be listed on a US return but are not eligible for a Social Security number.
K
M
- Missing documents listA missing documents list is the running, per-client record of the forms and answers a firm still needs before a return can start. It drives the reminders.
- Modernized e-FileModernized e-File (MeF) is the IRS system that receives e-filed individual and business returns, checks them against business rules, and accepts or rejects them.
O
P
- Period of limitationsThe period of limitations is the time the IRS has to assess more tax, and the taxpayer has to claim a refund, for a return: usually three years. It sets record retention.
- Practice management softwarePractice management software is the all-in-one suite a firm runs on: portal, workflow, e-signatures, billing, often a CRM. TaxDome, Canopy and Liscio are examples.
- Private AIPrivate AI means AI models that run on systems the firm or its vendor controls, so client documents are processed without being sent to a public AI service.
- PTIN(Preparer Tax Identification Number)A PTIN is the number every paid tax return preparer must have and renew each year. It goes on every return the preparer signs.
R
- Refund advanceA refund advance is a short-term bank loan, offered through the tax preparer, that gives the client part of their expected refund now and is repaid from the IRS refund.
- Refund transferA refund transfer is a bank product that pays the preparer's fee out of the refund: the refund lands in a temporary account, fees come out, and the client gets the rest.
S
- Section 7216Section 7216 makes it a crime for a tax return preparer to knowingly or recklessly disclose or use tax return information beyond preparing the return without consent.
- SOC 2A SOC 2 report is an independent auditor's report on a vendor's security controls, and optionally availability, confidentiality and privacy. It is not a certification.
T
- Tax CRMA tax CRM is client relationship software for a tax practice: contacts, each return's status, messages and calls, and reminders due, kept apart from the tax engine.
- Tax organizerA tax organizer is the questionnaire and document checklist a firm sends clients before the season, usually pre-filled from last year, to gather what the return needs.
- TCPA consent(Telephone Consumer Protection Act)TCPA consent is the permission a business needs under the Telephone Consumer Protection Act before automated calls or texts to a mobile number. Opt-outs must be honored.
W
- WhatsApp Business PlatformThe WhatsApp Business Platform is WhatsApp for companies that connect software to it: verified business, registered number, approved templates for outbound messages.
- Where's My Refund?"Where's My Refund?" is the IRS tool and app that shows a refund's status in three stages: Return Received, Refund Approved, Refund Sent. It updates once a day.
- WISP(Written Information Security Plan)A WISP is the written information security plan the FTC Safeguards Rule requires of tax preparers: who is responsible, what data the firm holds, the risks, the controls.