Category Archives: E-File

What Is E-File?

The Internal Revenue Service, or IRS, has created many methods of filing to make it easier for taxpayers. A filer can choose to either mail the tax forms in or send them electronically, known as e-filing. Previously, a user could submit their tax return by telephone, utilizing Telefile, but this service has been discontinued as of 2005. Advances in internet technology have made it possible to securely transfer these documents from a professional tax expert or home user to the IRS. The transmitted data is encrypted before transfer, thus no outside party can gain access to the information.


When e-filing, taxpayers must use third party software to complete the irs tax forms. Many different software companies have created packages that make e-filing very easy, asking pointed questions to locate hidden deductions that a paper filer may have missed. Most nationwide tax preparation experts have also created software for users that would prefer to complete their taxes from the comfort of their own home. Taxpayers that are choosing to file using the 1040EZ or who meet other requirements can find online software that allows them to complete and transmit the returns at no cost. These free options are legitimate and are one way the IRS is trying to make filing taxes easier.

 

There are many benefits to e-filing. Since human interaction is limited to data entry, there can be no mistakes with poor handwriting or other typical human errors. In addition, it is impossible for the forms to be lost in the mail on their way to the IRS. As soon as the form has been transferred, e-filers receive an email acknowledging receipt of the form. If this was not reason enough to e-file, processing times are much quicker with e-filers and many receive a tax refund by direct deposit to a bank in as little as eight days. Again, there is no chance that the check could be lost in the mail.