Free E-file Opened by the IRS Ahead of 2015 Tax Season
Although the tax filing season doesn’t normally kick off until the end of January, approximately 100 million tax payers will be able to file their federal tax returns early this year. This is due to the IRS opening their e-file service ahead of the 2015 season, which allows tax payers to file their returns electronically for free.
Individuals and families who earned an adjusted gross income of $58,000 or less in 2014 are eligible to file their returns early by using the IRS’s free e-file system. The Free File Fillable Forms, which are simply an electronic version of the IRS’s paper forms, assist taxpayers with math but do not provide step-by-step instructions. In addition, state tax return preparation cannot be performed using this option.
Start Date of the Program
The 2014 Free File program began on January 17, 2015, by the IRS and the Free File Alliance, a partnership consisting of 14 tax software businesses that associate with the IRS.
Major Savings Incurred by Using Free E-file Services
Tim Hugo, Executive Director of the Free File Alliance, has noted that their complimentary online commercial tax preparation software programs have saved American taxpayers $1.2 billion since the program’s inception in 2003.
How to Find a Free File Program
The IRS supplies a list of the free tax preparation software from the Free File Alliance member companies. Therefore, taxpayers can select the software and company that is most applicable to their tax situation. The IRS has also provided a “Help Me Find Free File Software” tool that helps taxpayers find the best software for their needs.
How to E-file the Return
Once a tax software provider has been selected, the taxpayer is taken directly to the software company’s website. At that point, the taxpayer can complete his or her federal tax return and e-file the return for free. In addition, a convenient tool called Get Transcript allows taxpayers to download their tax returns from the prior year directly from the IRS. The tax software service is provided in a choice of either English or Spanish.
Tax Return Submission Date
Although the free e-file software programs are open ahead of the 2015 tax season, the completed e-filed returns are actually held by the Free File software businesses until January 20. This is the date when the IRS will start to accept tax returns.
Benefits of E-filing Systems
There are significant benefits to using the free e-filing systems, including that they allow taxpayers to file more quickly than the traditional paper method. John Koskinen, the new IRS Commissioner, has stated that there is absolutely no advantage to filing by paper. In addition, once the tax return has been filed through an e-filing system, the IRS receives the return immediately and it can be processed accordingly.
IRS Website Provides Taxpayers With Information
The IRS website (www.irs.gov) is an excellent source of information for taxpayers seeking assistance in preparing their returns. The site includes YouTube videos with tax tips as well as many additional ways of obtaining information. In addition, the site contains services such as a “Where’s My Refund?” section where taxpayers can determine the status of their refunds.
How to Receive an Updated Status of a Refund
The status of refunds section of the IRS website provides personalized information regarding refunds upon request. Taxpayers can review the status of their submitted e-file return within just 24 hours after the return has been accepted by the IRS. The refund, if applicable, is updated on the IRS website once per day.
Best Method to Receive a Refund
According to the IRS, the quickest method for individuals and families to receive their refund is to combine an e-file submission with a direct deposit into their bank account. When the IRS starts to process tax returns, the agency anticipates providing over 90 percent of the refunds within 21 days.
Hopefully, this article got you thinking about how to advise clients properly on the topic of simplifying their tax filing. Aside from this, if you’re not already doing electronic tax filing on their behalf, you should. If you efile 1099 and other tax forms, your clients should receive refunds faster.
On top of this, I suggest you follow my lead if you’re printing and mailing tax forms still. I use eFile4Biz.com to file 1099 online, and focus on clients, instead of mailing paper forms. This service also integrates with the major accounting brands, on top of printing and delivering the tax forms for me. Their 1-minute video below will explain the details.