What Is e-file?
The IRS e-file program is an alternative to filing tax forms on paper and mailing them. Instead, e-file uses online electronic forms. The IRS began the e-file program in 1986 to lower its operating costs and reduce paper usage. The agency claimed that, in 2010, nearly 99 million people used the e-file system. Two benefits of using e-file are that you receive your refunds sooner and you reduce the chance of human or document errors with your filing.
How To e-file
The IRS offers two distinct methods to e-file a tax return. The first entails filing through a registered tax professional who has been approved for the e-file program. The IRS has been steering paid preparers towards the e-file solution for many years, so most of them support the system. If you prepare your own return, you can also e-file from your computer over the Internet using the "e-file" option in your tax preparation software. The IRS does not charge a fee for this service, but third-party intermediaries are allowed to charge. Check with the vendor of your tax preparation software to find out whether a fee is assessed when you e-file with its product.
When You e-file Your Return
When you e-file your tax return, you transmit your return using a transmitter component in your tax preparation software. The software converts your return into a format that meets IRS specifications and then transmits your return to the IRS. Once it receives the e-file, the IRS checks the return and notifies the transmitter whether the return is accepted or rejected. The transmitter then informs you. The IRS claims that almost 89 percent of returns have been accepted the first time.
When You e-file for An Extension
The IRS allows taxpayers to file electronically certain other documents with the e-file system. One of the most common e-file forms is the request for an extension. Typically, an extension request with the IRS is filed on paper Form 4868; however, you can also file this form using e-file. When you file a Form 4868 extension request using e-file, the IRS delivers a confirmation number at the completion of the transaction. If you use a third-party service to file this extension, the service typically emails you the confirmation or allows you to access it when you login to the service's website.