LAKE COUNTY — The Internal Revenue Service (IRS) has expanded its e-file program for 2008 federal tax returns. Expanded features allow greater access to electronic filing and assist people who are looking for faster refunds.
Access to the upgraded program will be available online beginning Friday, Jan. 16.
The IRS is encouraging taxpayers to explore e-file this year as the best option to file accurate tax returns and get fast refunds during the current economic downturn. The e-file program also includes new improvements to the Free File program that will allow nearly all taxpayers to e-file for free.
“Our goal is getting those refunds out as quick as possible. There really is no reason for everybody not to file their taxes electronically this year,” David Williams, IRS technology advisor said. “There are options for every taxpayer in every income level to both prepare and file their taxes for free.”
Taxpayers who use e-file and who choose direct deposit can receive their refund in as few as 10 days. It can take up to six weeks to receive a refund using the traditional paper method, Williams said.
“These are tough times and e-file is the best way for people to get cash in their pocket quickly,” IRS Commissioner Doug Shulman said. “Filing electronically with direct deposit can get refunds to taxpayers in as few as 10 days. Combined with important changes in the Free File program, we believe e-file is a better option than ever before for the nation”s taxpayers.”
The e-file program allows taxpayers to file their returns now and pay later if they owe taxes. It also allows taxpayers to file both federal and most state returns at the same time. The e-file program can be used through tax preparers or with a computer using tax preparation software. The software is available on the Internet for online use or for download. Many retail stores sell the software for offline use. The IRS does not charge taxpayers to e-file their completed returns, but some tax preparers and software manufactures may charge a fee. However, this year a number of large software companies are waiving this additional fee, Williams said.
“I think the reason they are eliminating (the additional fee) is because it is really a bone in the side for people who are e-filing,” Williams said. “The competitive market place is changing. That competitive pressure is driving out that additional fee.”
Williams said a benefit to using the e-filing program is taxpayers do not need to know all the new tax law changes. “The software has knowledge built in about tax breaks and it can correct basic errors, too,” he said, adding that the error rate using e-filing is significantly lower than the error rate using paper filing.
E-filed tax return information is protected through encryption and taxpayers receive an acknowledgement within 48 hours that the IRS has accepted or rejected their return.
The IRS also offers Free File, which a form of e-file. It is a free federal tax preparation and electronic filing program for eligible taxpayers developed through a partnership between the IRS and the Free File Alliance LLC, which is comprised of a group of private-sector tax software companies.
Free File offers 20 different software options that can assist taxpayers with an Adjusted Gross Income (AGI) of $56,000 or less in 2008 to e-file their federal tax returns for free. “That means 70 percent of all taxpayers ? 98 million taxpayers ? can take advantage of tax software that will help them complete their returns through the Free File program,” Williams said. Three companies are reportedly offering their products in Spanish.”
In addition, the IRS and its partners are offering a new option, Free File Fillable Tax Forms, which opens up Free File to virtually everyone, even those whose incomes exceed $56,000.
Free File Fillable Tax Forms allows taxpayers to fill out and file their tax forms electronically, just as they would on paper. This option does not include an “interview” process like the other Free File options, but it does allow taxpayers to enter their tax data, perform basic math calculations, sign electronically, print their returns for their records and e-file their returns. This “self-service” option may be right for those who are comfortable with the tax law, know what forms they want to use or don”t need assistance to complete their returns, Williams said.
Both the fillable-forms option and the previously available “full service” Free File offerings are available only through the IRS.gov Web site. Both new and returning taxpayers must access Free File through IRS.gov. Otherwise, the e-file provider may charge a fee. Details regarding the programs will be available on IRS.gov beginning Jan. 16.
Contact Denise Rockenstein at drockenstein@clearlakeobserver.com or call her directly at 994-6444, ext. 11.
