IRS e-file is open; most taxpayers can file immediately

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The Internal Revenue Service electronic filing systems are open and the IRS wants to remind taxpayers that e-file remains the best way to get fast refunds and ensure accurate tax returns, particularly following several tax law changes in December.

IRS e-file is approaching the milestone of 1 billion returns processed. The electronic transmission system, which has revolutionized the way the IRS processes tax returns and made speedy refunds possible, has safely and securely processed 892 million tax returns since its national debut in 1990. In 2010, nearly 100 million people nationwide- 70 percent of the taxpayers - used IRS e-file.

“IRS e-file is the best option for everyone, especially for people impacted by recent tax law changes,” said Doug Shulman, IRS commissioner. “E-file ensures people can file accurately and get refunds quickly. With a new legislative e-file mandate for tax preparers, we anticipate that more tax return preparers will be using e-file this year, and we urge people who prepare their own taxes to give it a try. IRS e-file is now the norm, not the exception.”

Also, the IRS anticipates starting to process tax returns impacted by December’s tax law changes by mid-February. The IRS continues working to reprogram its computers to reflect new tax law changes enacted by Congress and signed by the President in December.

Generally, taxpayers who itemize their deductions by using Schedule A, who claim the higher education tuition and fees deduction or who claim the educator expense deduction must wait a few more weeks to file their returns. Based on historical filing patterns, the IRS anticipates the delay impacts about 9 million taxpayers. While the delay impacts both paper and electronic tax returns, most taxpayers can file immediately. More details are available on IRS.gov.

Although the IRS has not announced a specific mid-February start date for accepting the delayed tax returns, many people using e-file can get a head start. Many major software providers have announced they will accept these impacted returns immediately. The software providers will hold onto the returns and then electronically submit them after the IRS systems open in mid-February for the delayed forms.

Taxpayers using commercial software can check with their providers for specific instructions. Taxpayers should check with their tax return preparers, who also may be holding prepared returns until the updates are complete.

Even with the delay, IRS e-file remains the fastest option for taxpayers, and e-file returns will be processed and refunds issued much faster than paper returns. It will take less than two weeks to process an e-filed return, but as many as four to six weeks to process a paper return.

“IRS e-file offers many benefits including faster refunds and more accurate returns,” said Sue Hales, IRS spokeswoman. “Taxpayers who chose to e-file and use direct deposit get their refunds in as few as 10 days.”

E-file is safe and secure, Hales advised. It has proven itself year in and year out as a safe and secure method of filing a tax return. Software vendors and preparers use the latest encryption technology.

Taxpayers can e-file their tax returns one of three ways: through a tax return preparer, through commercial software or through IRS Free File .

For people seeking free electronic options to do their own taxes, IRS Free File offers something for almost everyone through two formats: brand-name software or online fillable forms.

People with adjusted gross incomes of $58,000 or less can prepare and e-file their federal tax returns for free through the IRS Free File program. Free File must be accessed through the IRS Web site at www.irs.gov . Click on Free File Home - Your Link to Free Federal Online Filing .

For taxpayers whose incomes are more than $58,000, there’s Free File Fillable Forms. This program is best for taxpayers experienced in preparing their own federal tax returns. For people who prefer completing a paper tax return, this is an electronic alternative.

As people have become more comfortable using computers and the Internet for financial transactions, the IRS has seen a huge increase in the number of people who are preparing their own tax returns with the help of software. Last year, more than one-third of all e-filed returns were prepared by taxpayers using tax software.

People looking for a tax return preparer who files electronically and for more information on e-file can review IRS e-file for Individuals . Taxpayers also can locate an e-file authorized tax professional nearest to them by doing a zip code search.

When using e-file, you also must use an e-signature . The IRS no longer accepts the paper signature document. If you prepare your own return using software you must use the self-select PIN method. If you have a third-party prepare your return, you can use either the self-select PIN method or the practitioner PIN method. Additional information is available at IRS.gov.

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