Do you remember the times when tax returns had to be filled out on paper and mailed to the IRS (in the United States)? Today, most firms and even individuals use electronic filing. Electronic filing is easier, greener and faster. Software to file tax returns can be bought in many shops and online. Nonetheless, a long time ago, people did not file their tax returns electronically. What is of particular interest is the time when the electronic filing just came about, many people were skeptical about it. Thus, the following short article, written in 1994, describes how people thought whether or not to file taxes online in the past. For some Internet history, read on…
Should You File Electronically
Chances are you will get a refund faster and avoid IRS clerical errors.
Seven out of ten taxpayers get refunds after they file their returns. To speed the process, you can bypass the Post Office and file your return electronically. Refunds on paper returns often take about six weeks to arrive, but people filing electronic returns typically get theirs in half that time, or even faster if they ask the IRS to deposit the refund directly into their bank account.
Tax-preparation firms often offer to file electronically for an extra charge. And tax programs for home computers often include procedures to let you transmit a completed return via modem to an IRS-approved processor who will forward it to the IRS. But there’s still paperwork. You must complete Form 8453 to authorize electronic filing and attach your W-2.
The fastest « refunds » – generally just a few days – go to people who file electronically and arrange for an immediate short term loan in the amount of their coming refund. Banks make these refund anticipation loans through tax preparers and get repaid directly from the refund. The charge varies, but the loans rates went up earlier this year after the IRS began new procedures to check returns for fraudulent refund claims. Banks said the loans became riskier after the IRS stopped providing credit information about taxpayers to the lenders and delayed some refund claims for authenticating.
The IRS hopes to encourage widespread use of electronic filing since electronic returns have fewer math and other errors that the agency must fix. Electronic filing also saves the IRS embarrassment. Many errors that crop up on paper returns are caused by IRS personnel themselves as they copy data from the returns.
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