LEGACY, CADE, MeF – WHAT IS THIS ALL ABOUT?
February 23, 2011 – 3:02 pmOver the last several years the IRS has been updating their backend systems and processes in an effort to move to a more efficient and modernized platform. As we all know, to get from point A to B can often take a lot of time and effort.
The IRS has used the ‘Legacy’ platform since 1985 to e-file individual returns. In 2004 they introduced ‘CADE’ (Customer Account Data Engine) to process 1040EZ returns, with other forms and schedules added in a three phase process. The MeF (Modernized eFile) model was implemented in 2007 for business returns. In 2010 individual returns were included, but on a limited forms and schedules basis. In 2012 the IRS plans to adopt all individual forms and schedules to the MeF platform, however, this could be delayed.
So, what are the differences between these e-file platforms?
Most of you are familiar with the Legacy platform, which you have used to process individual federal and state returns for years. The Legacy platform allows the majority of the individual forms and schedules to be e-filed. Legacy has set drain times, and refunds are released on a weekly basis taking 8-15 days.
CADE is a database that processes a limited number of individual federal forms and schedules. Returns processed through CADE have a refund cycle of five business days, compared to the Legacy weekly cycle which takes 8-15 days. Returns processed through CADE are selected on the IRS side. As a preparer, no information is passed back to you regarding the returns filed through this system.
The MeF platform has been used to process business returns since 2007. In 2010 individual returns were added. The MeF platform handles a limited number of individual federal forms and schedules. Drain cycles are omitted in the MeF platform, returning near-real-time acknowledgments. Like the Legacy platform, individual refunds are released on a weekly basis taking 8-15 days, unless selected to flow through CADE which could be received in five business days. MeF also allows e-filing for two prior years, supporting a total of three tax seasons.
What does the future hold?
Moving forward, the IRS and states will move individual returns to the MeF platform, and the Legacy platform will be retired. The CADE system will allow IRS Customer Service representatives access to accurate and up-to-date information. The CADE database will enhance the use of both e-file and paper return data across the IRS, improving services and reducing costs.
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