Search in book...
Toggle Font Controls
Create new playlist

Name your new playlist

Playlist description (optional)
Sign In

Email address

Password

Forgot Password?

or

Continue with Facebook

Continue with Google
Sign Up

Full Name

Email address

Confirm Email Address

Password

or

Continue with Facebook

Continue with Google

Chapter 46
Everything you need to know about e-filing

Introduction

E-filing has been a tremendous success and is now the standard method for filing tax returns. It is the fastest and most accurate way to file your individual and business returns, and taxpayers like the faster refunds that come along with e-filing. The number of taxpayers choosing this method of filing continues to increase as taxpayers become more comfortable with electronic transactions and more preparers are mandated by the IRS or states to e-file returns. E-filing offers a number of advantages. It’s easy, efficient, and eliminates filling out paper forms line by line and doing the math yourself. If you owe additional taxes, you can e-file and authorize an electronic funds withdrawal, pay by credit or debit card, pay by enrolling in the Electronic Federal Tax Payment System (EFTPS), or choose other methods. The electronic funds withdrawal and EFTPS payment options are offered for free; however, you should expect to pay a convenience fee if you pay your taxes by credit or debit card. Generally, you will receive electronic proof of submission within 48 hours of when the IRS has received your return. Your return will be quickly and automatically checked for certain errors and some missing information. Most returns are accepted the first time they are transmitted. If you are entitled to a refund, you can typically receive it in less than half the time it takes for paper filers to get their refunds. Your chance of being audited does not differ whether you e-file or file a paper tax return. Finally, your bank account information, as well as your other tax return information, is safeguarded.

While e-filing is available for individual income tax returns, it may not be right for you. As an individual taxpayer, are you required to e-file? No, and no penalties will apply if you file using the paper method. However, if you use an income tax preparer, the preparer may be mandated to e-file all the returns that he or she prepares. In that case, you can issue a “Taxpayer Choice” statement to the preparer indicating your choice to file a paper return. You can ask your preparer for details and discuss your options. If you prefer to opt out of e-filing your federal return or if there is a particular reason why your tax preparer cannot e-file your return, Form 8948, Preparer Explanation for Not Filing Electronically, must be attached to your paper-filed tax return by your tax preparer explaining why the return is not being e-filed. If you do not use a paid preparer, the form is not needed.

Many states formerly allowed resident taxpayers to directly e-file a tax return for the taxpayer’s home state on the state’s Department of Revenue (DOR) website. However, most have now changed to a referral service for which the DOR will provide a link to various third-party vendors, some of which will provide access to online software to e-file your federal and state returns for free, if you qualify. See your state’s DOR website for the vendors that are recommended and the criteria to obtain the software free of fees, if you qualify. You may consider using the online method of filing directly rather than using tax preparation software if you are familiar with the rules and requirements of filing your state tax return. This chapter discusses the three options available for e-filing and which one, if any, might be right for you.

Information You’ll Need to E-File

Whether you decide to e-file or not, your first step is to get all of your tax information together. That way you’ll save time and won’t have to stop in the middle of preparing your return to find a missing document. A good point to start is by verifying that you have all the documents for the current tax year that you needed for last year’s return. The documents needed for each taxpayer’s return are different, but with e-filing, most documents do not need to be transmitted to the IRS. At a minimum, here’s what you’ll need:

Social security numbers for yourself, your spouse, and any dependents.
Forms W-2, W-2G, and 1099-R from all employers or payers for yourself and your spouse. If you choose to use an “authorized IRS e-file Provider” (explained later), you must provide these particular forms to the authorized IRS e-file provider before the return is submitted electronically to the IRS and possibly to relevant states.
Forms 1099 for interest, dividends, retirement, or other income, or any Forms 1099 with income tax withholding.
Schedules K-1 from pass-through entities, including partnerships, S corporations, estates, or trusts.
Expense receipts for itemized deductions (Schedule A).
Receipts and records for other income or expenses, including business income and expenses, if you are a sole proprietor.
Checking and/or savings account numbers and the routing number for your financial institution (for a faster refund, or to pay electronically).
A copy of your prior-year tax return.
Proof of acceptable insurance coverage under the Affordable Care Act. This is generally Form 1095-C, Employer-Provided Health Insurance Offer and Coverage, from your employer.

Note: For a brief explanation of some of the details of e-filing, also see Why Should I File Electronically? in chapter 1, Filing information.

Signing Your Electronic Tax Return (Self-Select PIN)

If you e-file your own return, you will sign your electronic return by using a Self-Select Personal Identification Number (PIN) for filing a paperless return. This allows you to confirm your identity with a five-digit PIN and your prior-year’s adjusted gross income (AGI). If you filed electronically last year, you can use the same PIN that you used to file last year’s return. In most cases it is unnecessary to mail anything to the IRS when using e-file to transmit your return. In certain cases, the IRS will require you to mail Form 8453, U.S. Individual Income Tax Transmittal for an IRS e-file Return, along with the supporting documents. See the Supporting Documents section for more information.

The five-digit PIN can be any five numbers except all zeros. You can use your PIN whether you do your own taxes using a personal computer (described later) or have a tax professional prepare them for you.

You create your own PIN. You do not register the PIN with the IRS before filing or need to contact the IRS to get it. When you use one of the commercially available tax software packages on your personal computer that support the Self-Select PIN option, you will be guided through the process of entering your own PIN. If you use a tax professional, the preparer will help you and will require that you sign an e-filing authorization form in that process, which may entail signing a paper form, entering your PIN on a keypad, or signing on a screen at the preparer’s office. If filing a joint return, a PIN is needed for each taxpayer, which may be the same or different numbers. The IRS has a web-based application called “Electronic Filing PIN Help” that provides taxpayers with a PIN to be used when they cannot locate their prior-year AGI or prior year PIN; refer to www.irs.gov for more information.

The following taxpayers are eligible to use the Self-Select PIN method:

Taxpayers who are eligible to file Form 1040 for the current tax year.
Taxpayers who did not file for an electronic return for the prior tax year, but have filed previously.
Taxpayers who are age 16 or older on or before December 31 of the current tax year who have never filed a tax return.
Primary taxpayers under age 16 who have filed previously.
Secondary taxpayers under age 16 who have filed in the immediate prior year.
Military personnel residing overseas with APO/FPO addresses.
U.S. citizens and resident aliens residing in the American possessions of the Virgin Islands, Puerto Rico, American Samoa, Guam and Northern Mariana Islands, or with foreign country addresses.
Taxpayers filing Form 2350 or Form 4868 (extension of time to file).
Those who are filing on behalf of deceased taxpayers.
Taxpayers required to file the following forms, which must be attached to Form 8453, U.S. Individual Income Tax Transmittal for an IRS e-file Return:
Form 1098-C, Contributions of Motor Vehicles, Boats, and Airplanes
Form 2848, Power of Attorney
Form 3115, Application for Change in Accounting Method
Form 3468, Computation of Investment Credit
Form 4136, Credit for Federal Tax Paid on Fuels
Form 5713, International Boycott Report
Form 8283, Non-Cash Charitable Contributions, Section A (if any statement or qualified appraisal is required) or Section B, Donated Property, and any related attachments (including any qualified appraisal or partnership Form 8283)
Form 8332, Release of Claim To Exemption for Child of Divorced or Separated Parents
Form 8858, Information Return of U.S. Persons with Respect to Foreign Disregarded Entities
Form 8864, Biodiesel and Renewable Diesel Fuels Credit
Form 8885, Health Coverage Tax Credit, and all required attachments
Form 8949, Sales and Other Dispositions of Capital Assets (or a statement with the same information, if you elect not to report your transactions electronically on Form 8949).

If you have scanning software that allows you to scan the forms you filled out from the list above and attach them to the electronic tax return you are e-filing, Form 8453 does not have to be completed or mailed to the IRS. If the software does not support attaching Form 8283 to the e-filing, Form 8453 may be completed and mailed to the IRS. If forms or documents other than those listed on Form 8453 need to be submitted, then the return cannot be e-filed.

Supporting Documents

The IRS requires the supporting documents listed in the section above to be mailed in hard copy if they cannot be attached to the electronic file for your tax return as pdf documents. If you need to file any of those forms or schedules and your software or tax preparer cannot transmit a pdf copy of the form, you may need to include a copy with Form 8453 (with the appropriate boxes checked) and send the package to the IRS (see the form Instructions for the applicable address) after your e-filed return has been acknowledged and accepted by the IRS. Refer to Form 8453 for specific documents that must be attached in support of the following forms if you or your preparer is not able to attach them to your return as pdf documents: That list matches the list above at the time of this publication, but note, however, that the IRS can change the list from time to time. Your return is not complete until all required forms are received from the IRS and you receive a notice that your return is completed.

Transmission and Acceptance Process

After you sign the return using a Self-Select PIN, the electronic record of your tax return is transmitted to the IRS for processing. Once received at the IRS, the return is automatically checked by computers for errors and missing information. Typically, the software used to transmit the return will have checked for certain errors and then the IRS software checks further. If the return cannot be processed, it is sent back to the transmitter to clarify any necessary information, which may or may not require input from the taxpayer (see Errors/Rejections, below). After correction, the transmitter retransmits the return to the IRS.

Within 48 hours of electronically sending your return to the IRS, the IRS sends an acknowledgment to the transmitter stating the return is accepted for processing, and the transmitter will make this information available to you. This is your proof of filing and assurance that the IRS has your return information. As long as your return was transmitted by the filing deadline, your return will be considered to have been timely filed, even if errors need to be corrected after the filing deadline and the errors are corrected in the specified calendar days (see more below). If you e-filed using your personal computer and have any of the items listed above under Supporting Documents, you need to mail the documents along with the completed Form 8453 to the IRS within 3 business days after receiving the acknowledgment (unless your software allowed you to attach a pdf with those items to the e-filing). If a tax preparer e-filed your return, the preparer is responsible for sending Form 8453 to the IRS on your behalf within 3 business days after receiving the acknowledgment, if needed.

Errors/Rejections

Validation checks are built into return preparation software to catch certain errors in the process of preparing tax returns. Also, the IRS performs automatic checks when a return is initially e-filed and will “reject” the return if certain errors or inconsistencies are detected. If the IRS rejects an e-filed return, you or your preparer will receive electronic notification of the items causing the return to be rejected. You should promptly correct the issues and resubmit the return for e-file within 5 calendar days (for Form 1040). It is critical that you or your preparer monitor the e-file transmission until you receive the acknowledgment indicating the IRS has accepted your return in order to be sure that your return is considered to be timely filed. Both your tax return preparation software and the IRS will provide assistance to resolve rejection notifications and facilitate acceptance of your e-filed return with detailed descriptions of what is causing the return to be rejected. These errors include, but are not limited to; missing or inaccurate SSN (social security number), misspelled names, filing status error, math mistakes, errors in figuring tax credits or deductions, incorrect bank account number, forms not signed, electronic filing PIN error, or filing with an expired ITIN (Individual Tax Identification Number). However, in the rare event that you are unable to resolve the issues listed in the rejection notification, you will be required to submit the return in paper format. In order to timely file a paper return, you must file it by the later of the due date of the return (including extensions) or 10 calendar days after the date the IRS rejects it. In such a situation, keep documentation of the e-filing and the related rejection dates to support timely filing of the return in paper format, even after the due date. Because of the many validation checks built into both the return preparation software and the IRS e-file process to locate errors before the final return is allowed to be transmitted, the error rate on e-filed returns is dramatically lower than on paper-filed returns, thereby reducing the chance of IRS notices. A very high percentage of e-filed returns are accepted the first time they are transmitted.

Refunds

If you’re due a refund and e-file, you can generally expect to receive it in approximately 3 weeks from the acknowledgment date—or even as fast as 10 days if you e-file and choose direct deposit. To find out where your refund is in the IRS return processing pipeline, go to www.irs.gov and choose “Where’s My Refund.” You’ll need your SSN or ITIN, filing status, and the exact whole dollar amount of your refund. The direct deposit method will enable you to direct your refund into up to three separate checking, savings, or other accounts that are in your name or your spouse’s name. (i.e., individual retirement arrangement (IRA), health savings account (HSA), Archer MSA, Coverdell education savings account (ESA), or TreasuryDirect® online account) by providing the routing information for your financial institution and your bank account numbers. You can also request that your refund be used to buy up to $5,000 in paper U.S. Series I savings bonds. These requests are made using Form 8888, Allocation of Refund (Including Savings Bond Purchases).

Making Tax Payments

If you owe additional taxes, you can make payment in several convenient ways (See also www.irs.gov/Payments):

Option 1: By authorizing an electronic funds withdrawal from a checking or savings account. For electronic funds withdrawal, you include the routing information for your financial institution and your bank account number on Form 1040 when you file electronically. You can designate the exact date (up to and including April 15) that you want the payment to be withdrawn (by the Department of Treasury financial agents) from either your checking or savings account at your bank or other financial institution,

Option 2: By credit card (American Express^®, Discover^®, MasterCard^®, Visa^®, or PayPal Credit) or debit card (Visa^®, Discover^®, MasterCard^®, NYCE^®, Pulse^®, ACCEL^®, or Star^® Debit Card), or Bill Me Later^®, a PayPal^® Service. This payment is facilitated by a third-party payment processor that you choose at www.irs.gov, and a convenience fee will be payable to that processor. The available options change from time to time, so the list at www.irs.gov may be different than this list.

Option 3: By mailing a check or money order (made payable to the United States Treasury) using Form 1040-V, Payment Voucher (if filing your return on paper), or

Option 4: By enrolling in the Electronic Federal Tax Payment System (EFTPS), which is a secure government website that allows users to make federal tax payments and schedule tax payments in advance conveniently 24/7 via the Internet or phone. For more information on EFTPS, go to the IRS website (www.irs.gov) and choose “EFTPS” under “Filing & Payment” on the right-hand side of the website. To enroll in the EFTPS program or to make an electronic payment, go to the EFTPS site (www.eftps.gov/). Note that you must enroll in the program before you utilize it. EFTPS allows individuals to schedule tax payments up to 365 days in advance of their due date, and modifications to those payments can be made up to 2 business days in advance of the scheduled payment date. Payments must be scheduled at least 1 calendar day prior to the tax due date by 8:00 p.m. Eastern time.

Option 5: Using Same-Day Wire for Federal Tax Payments. Your financial institution may be able to assist you with wiring your payment to the IRS. Financial institutions have varying availability, costs, and cutoff times. If your financial institution can perform a wire transfer for you, download the Same-Day Taxpayer Worksheet at www.irs.gov/uac/same-day-wire-federal-tax-payments and take that information to your financial institution.

Option 6: By agreeing with the IRS to make payments later. If you cannot pay now, you may arrange with the IRS to make payments later through using an Online Payment Agreement, making an Offer in Compromise, or applying to Temporarily Delay Collection. More details are available at: www.irs.gov/individuals/payment-plans-installment-agreements. With most deferred options, interest and penalties will apply based on the type of tax, magnitude of the late payment, and how long the payment is late.

One of the advantages of Options 1, 2, 4, and 5 is that you receive an immediate acknowledgment from the IRS when your payment is received. The downside of using a credit or debit card is that the credit or debit card companies will charge a separate convenience fee for this service, in addition to any interest that might be charged on any outstanding credit card balance. The main disadvantages of Option 6 are the penalties, interest charges, and establishing a record of late payments with the IRS. However, it is typically better to be within an established IRS payment program than to miss the tax payment with no arrangement with the IRS.

When To File and Pay Any Tax Due

If you use a tax professional, he or she can file your return electronically anytime during the filing season by April 15 (or the first business day after April 15, if it falls on a weekend or holiday) provided they have sufficient information from you to submit a complete and accurate return. However, sending the payment for a balance due by April 15 is your responsibility. Filing Form 1040 may be extended no later than October 15, but that extension does not grant an extension of payment of the taxes due April 15.

Your tax professional should advise you of the amount of any balance due by April 15, as well as discuss alternative methods to transmit your payment electronically, as mentioned above. If you are not using a tax professional, you may file electronically as soon as you are ready (by April 15) and will receive a confirmation from the IRS within 48 hours of receipt of your return. All balance-due payments, regardless of method of payment, must be authorized or sent to the IRS by April 15 to avoid late-payment penalties or interest charges, so be sure that the method you choose and the timing of initiating the payment will result in authorization by or receipt by the IRS on or before April 15.

E-File for Your State Tax Returns

The option to e-file your state return (Federal/State e-file) is an additional feature of IRS e-file and is allowed in most states and the District of Columbia. However, not all authorized IRS e-file providers offer this service. Your Authorized IRS e-file Provider can tell you if they participate in the Federal/State e-file program. Most e-filling software packages will transmit your state tax returns along with your federal return. Be sure to understand any additional fees for e-filing your state returns.

Extra Fees for E-Filing

The IRS does not charge a fee for electronic filing. However, some Authorized IRS e-file Providers (or Electronic Return Originators, “EROs”) charge a fee for providing this service to their clients while others may offer it free of charge. This fee cannot be based on any figure from the tax return, but may be based on the number of forms and schedules that your reporting situation requires. Fees vary depending upon the tax professional you choose and the specific services you request.

With IRS e-file, you can prepare your own return and pay a professional only to transmit it electronically, or you can pay to have your return both prepared and transmitted. Whichever you choose, shop around for a tax professional who offers the services you need at a cost acceptable to you.

Methods of E-Filing

There are three basic methods to e-file your tax return: using a tax professional, using your personal computer, and the IRS “Free File” option. We’ll explain each of these methods in detail.

Tax Professional

Tax professionals who are accepted into the electronic filing program are called “Authorized IRS e-file Providers.” In many cases, the tax professional is also the ERO who is authorized to file your return electronically with the IRS. In most cases, the ERO will be the person who prepared your return, but if you’ve prepared your own return and are simply using a tax professional to transmit the return, the tax professional will need to convert the return into the appropriate format for e-filing.

Many tax professionals are mandated by the IRS to e-file eligible returns for their clients. To find a tax professional to file your return electronically, search online for the Authorized IRS e-file Provider nearest you, or look in your local telephone directory under “Tax Return Preparation” for an Authorized IRS e-file Provider that meets your needs. Also, look for the “Authorized IRS e-file Provider” sign or decal in storefront windows.

The Tax Professional will sign the e-filing authorization form as an ERO (and Tax Preparer, if applicable). The tax professional will ask you to sign the e-filing authorization form and will provide you a copy of the return and fully signed e-filing authorization form. Keep these copies for your records.

Personal Computer

Instead of using the services of a tax professional, you can quickly and conveniently e-file your return using a personal computer. To do this you can:

Purchase commercially available software,
Download software from an Internet site and prepare your return offline, or
Prepare and file your return directly with a service online. Some vendors offer websites to complete your entire return online and then transmit it.

Note: The IRS cannot compete with private enterprise and does not offer free e-file software or direct filing. A number of companies, tested and approved by the IRS, do offer free use of their software and free filing, while others will charge nominal fees. Terms and conditions vary among companies and you are advised to review the information on each company’s website and choose the product that is appropriate for you.

Who can file using a personal computer? Anyone is permitted to use this method of filing, and the method is not limited to a computer. Software and applications are available to enable other electronic devices to help you file your return. Access to the Internet through a personal computer or other device is necessary. Software can be purchased, downloaded from the Internet, or accessed online.

Using this method, you prepare your tax return on a personal computer or other device and transmit the information to the IRS. You can generally transmit up to five returns using tax preparation software, which enables you to prepare returns for family and friends with the same software and computer used for your return.

To actually e-file your return, the tax preparation software first converts your tax data into a format that meets IRS specifications and then transmits the electronic file to the IRS. The IRS checks the return and notifies the transmitter (who then informs you) whether the return has been accepted or rejected. If your return is not accepted, the electronic return transmitter will provide you with customer support to correct your return and resubmit it.

Signing your return. You can sign the return using the Self-Select PIN if you meet the eligibility requirements described earlier in this chapter. If you do not meet the eligibility requirements, you will need to electronically authenticate yourself using other information, such as your prior-year Adjusted Gross Income (AGI). Following the completion of your return, you should retain copies of your return and all items used in preparation (including documentation of signing of the return by you and, if applicable, your spouse) and copies of any documents sent to the IRS. Generally, the requirement is to retain these documents for at least 3 years after filing for federal purposes, but some states require 4 years of retention. Many advisors suggest maintaining the e-filing documents for 7 years, which more than meets the current requirements for any jurisdiction. Remember to retrieve any documentation that you may need in the future (such as real estate closing statements) when you purge your tax information for a tax year.

Extra fees for e-filing a tax return from a personal computer. The IRS does not charge a fee for e-filing using a personal computer or other devices. However, an electronic return transmitter offering this service to taxpayers may charge a fee for transmission. Check out the IRS e-file Partners or Online Filing Software Companies listed at www.irs.gov to learn about free and low-cost e-file opportunities.

Payment methods and refunds. The same payment methods available by using a tax professional are available with e-filing from a personal computer (see above). Refunds should generally be in your savings or checking account within 2 to 3 weeks if you choose direct deposit or in 3 weeks or more if you choose a paper check. If you combine e-file with direct deposit, you could receive your refund in as few as 10 days. Be sure to verify the refund methods available from your state and choose the option best for you before transmitting your state return. Some states have a longer wait time than others to issue refunds.

If you have additional federal questions, you may contact the IRS’s toll-free customer service at 1-800-829-1040. As tax deadlines approach, be prepared for lengthy hold times.

IRS Free File

This program began in 2003 and is a popular e-filing method.

Through a public-private partnership between the IRS and the tax software industry (i.e., Free File Alliance, LLC), you may access free online tax preparation and electronic filing services through www.irs.gov. Eligible taxpayers may prepare and file their federal income tax returns using online software provided by the Free File Alliance companies—not the IRS.

Once in the IRS website, you can select the best match for you from the Partner’s offering or use a “help me” tool to narrow your choices, then click on “Continue” to be directed to the Partner’s website to begin your tax return safely and securely. You will need to have your email address, copy of your prior year’s tax return, as well as documents for your income and deductions.

The partnership agreement calls for the Free File Alliance to provide free tax preparation and filing to at least 70% of all taxpayers. Each participating software company has its own eligibility requirements, but none offer Free File to taxpayers with an adjusted gross income of more than $60,000.

The difference between Free File and the first two methods is that the entire filing process must take place online—there is no need to visit a tax professional or purchase or download software. You just input data while you’re on the provider’s website to complete your return. It saves time and it is easier to track your refund.

Privacy and security concerns. Your tax information and data will be protected when using a software provider’s website. To ensure your data’s safety, the IRS requires participating companies to obtain both privacy and security seal certifications. These certification programs, administered by third-party providers, certify your tax return information is protected from unauthorized access during the tax preparation process. Be sure your personal computer is protected by installing and updating antivirus software.

In addition:

Tax return preparation is accomplished using proprietary software approved by the IRS; transmittal is through the established IRS e-file system.
Alliance companies must comply with all federal rules and regulations on taxpayer privacy for paying and free customers. These rules prohibit use of tax return data for purposes not specifically authorized by the taxpayer.
The IRS meticulously monitors the progress of each of the companies. If any problems develop, the companies are required to alert the IRS. If appropriate, the IRS will remove the company from the www.irs.gov website until the problem is resolved.

For more information, you should visit the company’s privacy and security policy located on the company’s website.

Step 1. How to get started

Begin at the IRS website (www.irs.gov) and choose “Free File.”
Click on “Start Free File Now.”
The program can also be accessed through the IRS website at the following address: http://apps.irs.gov/app/freeFile
The IRS Free File page is where you may begin your search for a Free File company.

Step 2. Determine your eligibility: You must first determine your eligibility for using a particular company. Each company has a simple description of its eligibility criteria for using its free service.

Step 3. Link to Free File company service: After choosing a company, click on the company’s name, which sends you directly to the company’s website (you will be notified you are leaving www.irs.gov and being sent to a commercial website). Follow the instructions on that company’s website to begin the preparation of your tax return.

Alternatively, if you are having trouble choosing by scanning the list of Free File companies, you may want to use the interactive help tool. Choose “Free File Software Lookup Tool” at https://apps.irs.gov/app/freeFile/jsp/wizard.jsp to narrow down the possible companies offering free preparation and e-filing for you. Answer the questions on the website and click “Continue.”

If you are uncertain about your answers to these questions, you may want to view the complete list of companies and their services. The accuracy of the results is dependent on the accuracy of the information you provide in the tool.

Step 4. If you do not qualify for the selected company’s free offer: You may want to check other Free File company offers by accessing the www.irs.gov Free File page. If you are on the company’s website, look for the link that takes you back to www.irs.gov and search for another Free File service. Go back and scan the listing of free company services as described in Step 3.

If you do not qualify for the company’s free offer but continue with the preparation and e-filing process with this company, be aware you will be charged a fee for preparing and e-filing your federal tax return.

Example. If you select a company whose free services are provided to individuals with an adjusted gross income (AGI) of $60,000 or less and, based on your tax data, the company determines your AGI exceeds the $60,000 limit, you will be notified that you will be charged a fee. It is important that you understand each of the company’s eligibility criteria (which can be reviewed at the IRS Free File page as discussed above) before selecting a company. You may find the fee for returns not eligible for Free File on each company’s website along with additional details of the company’s offer, such as fees for state tax returns, if any, and a listing of tax forms the company supports. Access the company’s website directly from the IRS Free File page by clicking on the company name (you will be notified you are leaving www.irs.gov and being sent to a commercial website).

Step 5. Prepare and e-file your federal income tax return on a company’s website: The company’s software assists you to prepare and e-file your income tax returns using proprietary processes and systems over the Internet. Electronically filed returns are transmitted by the company to the IRS using the established e-file system. An acknowledgment file, notifying you that the return has been either accepted or rejected, is sent via e-mail from the company.

Refunds and payments using Free File are handled the same way as they are for the other e-filing options.

Free File Fillable Forms. The IRS has a program called “Free File Fillable Forms.” This program opens up free online filing to everyone regardless of income level by providing the online equivalent of a paper return. All forms needed to prepare and electronically file your federal income tax return are available (state return forms are not available). The program can be accessed through the IRS website on the Free File homepage or at the following link: www.freefilefillableforms.com/#/fd.

Once you access the program, you may select the federal income Free File Fillable Forms and schedules you plan to submit, fill in the tax data, perform basic mathematical calculations, sign electronically, print for recordkeeping, and e-file your return. Most federal forms are available and can be used by 1040, 1040A, or 1040EZ filers. Please note that this program does not include questions or guidance that could assist you in the preparation of your return. Free File Fillable Forms is most helpful to those who are familiar with the tax law, know what forms they need to use, and do not need assistance to complete their tax returns. If you are not comfortable with this method, you may want to access the www.irs.gov Free File home page and check out the list of companies that offer free tax preparation assistance and e-filing services via the Free File program explained previously.

..................Content has been hidden....................

You can't read the all page of ebook, please click here login for view all page.

Table of Contents for Chapter 46: Everything you need to know about e-filing

Create new playlist

Sign In

Sign Up

Table of Contents for
Chapter 46: Everything you need to know about e-filing