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E-File - Tax Filing Made Easy.About 70% of all individual tax returns use “short” tax forms (1040A or 1040EZ). Studies conducted by the IRS suggest that over ten hours are needed to prepare a 1040A tax return using paper forms. Meanwhile, several online tax software companies report that people using online tax software prepare and file their tax returns in well under an hour. In fact, about 50% of actual online tax software users completed their tax return, in one sitting, in under 30 minutes. Online tax software makes preparing taxes easy. The computer software leads you step-by-step and verifies the math. Using a personal computer with an Internet connection, online filers just answer the simple questions in tax preparation software, and the software will does the rest for you. No more last minute trips to the Post Office - just hit Send! IRS provides an official acknowledgement that your return was received. Owe money? You can authorize an electronic funds withdrawal from your savings or checking account or use a credit card. You can’t get these features with paper tax forms. Fast Tax Refunds: With IRS e-file, you can receive your Income Tax Refund in about half the time as paper filers, or even faster with Direct Deposit. With e-file, you can get your refund in 9-15 days. With paper forms, hope to get your refund in 3 to 6 weeks. Greater Accuracy, Fewer Errors: E-File tax software greatly reduces the chance for errors. You’re less likely to hear from the IRS down the road because e-filed returns are automatically checked for accuracy (99 percent accurate). If errors are detected, you or your tax preparer will receive an electronic message indicating the error and will allow the mistake to be corrected and resubmitted without penalty. Conversely, the IRS reports up to a 20% error rate in Paper Tax Return. Also, those using paper forms are more likely to receive an IRS penalty or have their payments misapplied. Peace of Mind: After e-filing your tax return the IRS provides an official acknowledgment of your tax return. You’ll get confirmation within 48 hours that the IRS received your return. This is something you do not get with paper form tax returns. And e-file is secure. The IRS reports that e-file transmissions are absolutely secure. IRS e file meets or exceeds all government security standards. And, according to the IRS taxpayers who use IRS e-file have no greater chance of being audited than those who file paper returns. If you owe money, you can file early in the season and delay electronic funds withdrawal payments to as late as April 15, 2005. Research shows that more than 80 percent of taxpayers who have tried e-file are “very satisfied” with the benefits of IRS e-file. 83 percent of individual taxpayers who use IRS e-file remained loyal and e-filed the following year. Why should I Choose E-fileOver the last few years, there have been several incentives, or even requirements, provided by the IRS and state governments to encourage tax filers to file their returns electronically. Statistics show the percentage of e-filers is on the rise. With tax return deadlines right around the corner, we want to share our thoughts on the questions we receive most often from clients about e-filing.
Top 5 questions I am asked about e-Filing: #5 Do I have to e-file? No. Currently, the IRS does not require any Tax Returns to be e-filed, though several states have implemented this requirement. In the past, the state has sent a "reminder" notice that future returns should be e-filed, but have warned that paper returns filed in the future will either be rejected or subject to a penalty. This most likely means that e-filing state income tax return in these states will be mandatory, and we can anticipate that other states will add similar requirements. #4 Do I have to provide my bank account information? No. The only time your bank account information needs to be provided is if you would like your refund directly deposited into your bank account, or if you would like your payment directly drafted from your bank account. If you are hesitant to provide your bank account information to government agencies, you can receive your refund by check or if you owe, you can make your payment by mailing in a check. #3 How long does it take to e-file? Usually a return is accepted by the IRS or state within a few business days of the return being submitted. The acceptance provides confirmation that the return has been timely filed. #2 If I owe with my return, is the payment due when my return is e-filed? E-filing the return before the due date does not accelerate the due date of taxes. Payments can still be remitted separately any time before the due date of the return, even if the e-file is processed earlier. Consider the following strategy. If you are due a refund on your state return, but owe on your federal return, then e-file both returns early. You could receive your state refund in time to use it towards your federal payment due. The same holds true if you are due a refund on your federal return and owe on your state return. #1 Why should I e-file? Here are a few reasons to e-file: The risk of a return being lost in the mail or misplaced is minimized. Usually a taxpayer is not notified of a missing return until months or even years later. When a return is e-filed, confirmation of acceptance (receipt) by the IRS or state is provided within a few business days. Paper filed returns are manually entered into the government's system, meaning that an input error could trigger a tax notice. Part of the e-filing acceptance process used by the IRS and state governments includes a "pre-check" of certain items. In order for an e-filing to be accepted, these items must be correct. This greatly minimizes the chance of receiving a tax notice. Returns are processed more quickly; if you are due a refund, it will be sent sooner. Mordernized e-file Issues and SolutionKnown Modernized e-file (MeF for Partnerships) Issues and Solutions (2008 tax year)
Binary Attachments • It has come to the attention of the Modernized e-File office that some transmitters/software developers/return originators are creating binary files incorrectly. In some instances, the IRS was unable to display the PDF document because of improper formatting. Effective immediately, please ensure that binary attachments are created according to the PDF standards in this correspondence. The internal identifier (first five bytes of the file) must be the standard PDF identifier, "%PDF-". If you have clients who use your software, please communicate to them the need to correctly create the binary files before transmitting. Beginning January, 2008, returns with incorrectly formatted binary files (PDF documents) will be rejected. Known e-file Issues and Solutions (2007 tax year) Listing more than one foreign country in Schedule B • Form 1065, Page 2, Schedule B, Question 9 asks whether or not the partnership had an interest in a financial account in a foreign country. The element is a boolean element. When the response is yes, the foreign country must be identified. The field for the foreign country code is an indicator on the Question 9 element. As such, only a single foreign country code can be identified at present. • If more than one foreign country needs to be identified, please use the dependency labeled "foreign country account statement", present in the schema, to attach a statement.Form 3115 Dependency attached to Part IV Line 27 • Section 481a Adjustment Schedule is missing from version 2.3 schema package. If this dependency is needed, please use the general dependency attached to the return to report this information. Correcting the Partnership Name Control• The partnership must write a letter to the IRS requesting a name control change. This should be done 30 day before filing a return. The letter needs to contain the partnership EIN, the current partnership name and name control and the new name control. The request must be signed by a partner of the business. If desired, the letter should also request confirmation that the name control change was received and made. The letter can either be faxed to (801) 620-7116 or mailed to: Internal Revenue Service 1973 North Rulon White Blvd. M/S 6273 Ogden, UT 84404 Changing the Name of the Partnership • 30 days prior to filing your return, the partnership must write a letter to the IRS requesting a name change. The letter needs to contain the partnership EIN, the current partnership name and the new partnership name. The request must be signed by a partner of the business. If desired, the letter should also request confirmation that the change was received and made. The letter can either be faxed to (801) 620-7116 or mailed to: Internal Revenue Service 1973 North Rulon White Blvd. M/S 6273 Ogden, UT 84404 Source: - irs.gov Conventional Way for Tax FilingThe easiest and quickest way to file a return and obtain a refund, is to do this electronically--a practice already used by more than half of all taxpayers. The conventional way of filing taxes with the IRS has been opposed by online tax filing systems in recent times. Filing online will allow you to get your tax refund in as little as 10 days. The process of Online Tax Filling is simple and trouble free. The customer first prepares his tax papers personally or approaches professional tax consultants to do so on his behalf. After the tax papers have been prepared they can be effortlessly filed through an IRS e-file provider. Filing can be done online as well, but if an individual is not sure about the mechanics, it is better to seek professional guidance. Usually most tax experts will be licensed IRS e-file providers. The relevant documents are signed and retained by the customer for future reference. The IRS e-file provider then files the returns electronically on the behalf of the customers. Next, the IRS e-file provider sends the customer an acknowledgement mentioning the current status of the filing process. Online filing eliminates the need for going through tiring steps of rushing to the local IRS offices and post offices and waiting in never ending queues to post the papers before the due date. Office hopping has been completely eliminated. The only thing required is a reliable computer and Internet connection. Mistakes and errors can be corrected online in comparatively less time. Online tax filing has reduced the time gap prior to receiving Tax Refunds and papers can be printed to maintain precise records for future reference. Online tax filing also facilitates tax payments using credit cards. It has reduced back office processing time considerably. Join the millions of people who have discovered how easy, online tax filing can be. The cost will be much less, your tax forms will get to the IRS with no hand-written errors, and you'll get your tax refund in as little as 10 days. Free IRS E-file online AllianceBecause of a partnership between the Internal Revenue Service (IRS) and 19 Free File partners, including Turbo Tax Online, many taxpayers are now eligible for Free Income Tax filing. If you qualify, you can use Turbo Tax Online, or any other of the 19 Free File partners, to prepare and file your income tax return online for free. This program is known as the IRS Free File Alliance. This free tax filing program is designed for lower income taxpayers with simple tax situations and includes IRS and State tax forms and schedules. However, it is not designed for more complex tax situations such as investments, rentals, royalties, farming, foreign earned income, partnerships, s corporations, estates or trusts. In addition, twenty-one states have also created free file programs based on the Federal free tax filing program. This means you may also qualify to file your State taxes for free with the Freedom Edition tax software. Free File differs from conventional tax filing in that Free File is an electronic tax program. You must use a computer and have Internet access to use the free tax filing service. Users enter their income tax data online and tax calculations are made by the online tax software. Completed tax returns are then sent to the Internal Revenue Service (IRS) through the efile system. Using the (IRS) e-file system allows you to get your fast tax refund. If it ends up that you owe money, you can have it deducted from your bank account on the last day of tax filing season. To file your taxes for free, go to IRS GO you can either begin your free tax filing or read more information about free tax programs. You'll find lot's of up-to-date tax information and handy tax tools, and you'll be able to get your taxes filed before it's to late. File Taxes Online Today for Free with Free IRS Efile.Once you're ready to start your taxes, you should consider the Free Efile Taxes option available to you today. Since you're here searching for information, may have already made up your mind. If you haven't, I can tell you that I have done my taxes online for three years, and I am really happy with the results, especially with how fast I get my return. The bottom line is making sure that you are paying the right taxes. This means that you should get all the refund to which you are entitled or pay the right amount to the government. Sometimes, when doing your return alone at the dining room table, you may gyp yourself. How many of us can guarantee that we understand all of the instructions and know all of the changes in tax laws? Not many. One of the great advantages of Free Tax Filing online is speed. Almost as soon as you finish your return it will be forwarded directly to the IRS. They will confirm receipt within a day or so. After that, if you are due a refund, it will come in days rather than weeks. Another advantage of filing online is that you can use the direct deposit option for a faster return. You should also consider the fact that online tax programs will help you to determine which form or forms to use. They will then walk you through the process step-by-step. Because of the way the programs are structured to ask you every important question, you may discover deductions that you might have missed. The end result is a far simpler process and far fewer headaches! |
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More and more Americans have chosen e-file, which lets them electronically file an accurate tax return or get an extension of time to file without sending any paper to the Internal Revenue Service. The 2007 filing season set a series of records, highlighted by 73 million tax returns being filed electronically and home computer usage jumping 18 percent. We saw a surge of e-filing at the end of the tax season, particularly with people using software on home computers. Compared to recent years, we had much more e-filing in the weeks leading up to the deadline, signaling that more balance due filers are embracing this service, said IRS Commissioner Mark W. Everson. Overall, we received more tax returns electronically this year than the number of paper returns we processed for the entire United States in 1966. E-file is changing the way the nation does taxes. Bookmark UsSubscribe To Feed
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