Tax Document Electronic Distribution - QR Codes

Annual Tax Documents with QR Codes

The concept of adding QR codes to annual tax documents has the following intentions:

  • Eliminate data entry errors in the income tax return preparation process
  • Reduce time spent in tax preparation
  • Reduce programming costs associated with Optical Character Recognition (OCR) technology
  • Increase success rate of tax document scanning over OCR
  • Provide a simple mechanism for tax document issuers and tax software to integrate without having to build full-fledged API connections

Two-dimensional bar codes, known as QR codes, store information as a series of pixels in a square-shaped grid that can be quickly retrieved using computer devices such as smart phones. Issuers of annual tax documents can encode document data as QR codes and tax software smart phone applications can retrieve that data for inclusion in income tax returns of individuals and businesses.

This diagram illustrates the workflow.

Issuers of Annual Tax Documents

On printed and PDF versions of annual tax documents, you add two-dimensional bar codes known as QR Codes which contain the tax document data in FDX JSON format. See the examples below and also information for developers.

Example QR code

 

Example Data

{
  "taxW2" : {
    "taxYear" : 2020,
    "employeeTin" : "XXX-XX-1234",
    "employerTin" : "12-3456789",
    "employerNameAddress" : {
      "line1" : "12020 Sunrise Valley Dr",
      "line2" : "Suite 230",
      "city" : "Reston",
      "state" : "VA",
      "postalCode" : "20191",
      "name1" : "Financial Data Exchange"
    },
    "controlNumber" : "012547 WY/OA7",
    "employeeName" : {
      "first" : "Kris",
      "middle" : "Q",
      "last" : "Public"
    },
    "employeeAddress" : {
      "line1" : "1 Main St",
      "city" : "Melrose",
      "state" : "NY",
      "postalCode" : "12121"
    },
    "wages" : 44416.74,
    "federalTaxWithheld" : 6907.16,
    "socialSecurityWages" : 47162.92,
    "socialSecurityTaxWithheld" : 2924.1,
    "medicareWages" : 47162.92,
    "medicareTaxWithheld" : 683.86,
    "codes" : [ {
      "code" : "C",
      "amount" : 301.5
    }, {
      "code" : "D",
      "amount" : 2746.18
    }, {
      "code" : "DD",
      "amount" : 4781.88
    } ],
    "retirementPlan" : true,
    "stateTaxWithholding" : [ {
      "stateTaxWithheld" : 1726.78,
      "state" : "OH",
      "stateTaxId" : "OH 036-133505158F-01",
      "stateIncome" : 44416.74
    } ],
    "localTaxWithholding" : [ {
      "localTaxWithheld" : 427.62,
      "localityName" : "Kirtland",
      "state" : "OH",
      "localIncome" : 44416.74
    } ]
  }
}

 

Example Document with QR Code

Download

Income Tax Return Preparation Applications

Tax software companies add QR code scanning to their smart phone applications as seen in the video clip below.

 

 

 

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