Sorry to disappoint science fiction or fantasy fans, but this won’t be a discussion of the portals that create doorways to other worlds, dimensions, or universes. Rather, these perilous portals are authenticated systems through which taxpayers access and manage accounts with state tax agencies. They provide a convenient way to file returns, make payments, upload documents, exchange information with tax authorities, and perform a host of other administrative tasks. All states now offer some form of online business taxpayer portal, although functionality varies significantly, ranging from basic filing and payment capabilities to full electronic correspondence management. So, what makes them perilous?

The peril arises in states whose statutes, regulations, or portal terms provide that notices, assessments, bills, and other correspondence are deemed received when the tax agency transmits them electronically or notifies the taxpayer that they are available online, regardless of whether the taxpayer actually opens or reviews them. In those states, enrolling in a taxpayer portal can effectively replace traditional paper correspondence with electronic delivery. As a result, taxpayers need to remain vigilant. Portals should be monitored regularly, and access should not be limited to a single employee or point of contact. Important deadlines may begin running before anyone within the organization has actually viewed a posting or notice. And while electronic systems are generally reliable, they are not infallible.

Another peril is a familiar one: states do not administer portal systems uniformly, sometimes not even across tax types within the same jurisdiction. Keeping track of differing delivery rules, notice standards, and appeal deadlines can become complicated. Measuring deadlines from a mailing date or actual receipt of a paper notice may seem quaint, but many states still rely on those concepts. A backup physical mailing to a registered business address when electronic communication goes unanswered still has considerable value.

There is no question that taxpayer portals offer substantial convenience and efficiency benefits. But unlike in fantastic fiction, it will not be entertaining if a portal becomes the source of a nasty surprise (like missing a deadline).