I have been advocating paying taxes electronically for quite some time now. Doing so is not only safe and accurate but eliminates any concern about the checks getting lost in the mail or stolen. This is especially true if the payment amount is large. Paying taxes electronically removes any potential late payment penalties.
It is so easy to forget sending in quarterly estimated tax payments. Setting them up to have the payments taken out of your bank account automatically on the due date makes a lot of sense.
The December 2009 issue of the Journal of Accountancy has an article on the subject and the author agrees. One caveat is that I would not advise anyone to pay taxes with their credit card unless it is the last resort.
Below is the first and last paragraphs of the article. You can click on the link to read the entire article.
http://www.aicpa.org/pubs/taxadv/dec2009/hurtt.pdf
With the e-filing of tax returns becoming more and more prevalent, practitioners and their clients should also take advantage of other electronic services that the IRS has introduced in recent years. These include the Electronic Federal Tax Payment System (EFTPS), electronic funds withdrawal, and payment by credit or debit card. This article
discusses the requirements and advantages of these electronic services.
More and more taxpayers are using electronic means to pay their taxes due to the number of available payment options. While each option has its pros and cons, depending upon the taxpayer’s or the practitioner’s needs, the options are safe and secure and give the taxpayer a streamlined way to pay taxes.
Showing posts with label e-file. Show all posts
Showing posts with label e-file. Show all posts
Monday, February 1, 2010
Tuesday, November 3, 2009
Two-Thirds of Individual Taxpayers Now E-file
http://www.webcpa.com/news/Two-Thirds-Individual-Taxpayers-Now-E-file-52278-1.html
By WebCPA Staff
Electronic tax filing set a new record this year, with 95 million individual federal income tax returns e-filed, up nearly 6 percent from last year’s total of nearly 90 million.
Approximately two out of three taxpayers filed electronically this year, said the IRS. Out of the 141 million returns filed so far this year, over 67 percent were e-filed, compared to 59 percent last year.
Each year, more taxpayers choose to e-file their tax returns. While the total number of tax returns has increased 10 percent during the past decade, the number filed electronically has increased by 168 percent.
Taxpayers who file electronically from a home computer continue to be an increasingly significant segment of those who e-file, the IRS noted. This year, for the first time, more than a third of e-filers filed their returns themselves from a home computer, accounting for approximately 34 percent of all e-filed returns from individuals. More than 32 million returns were e-filed from home computers, up almost 20 percent from last year’s record of 27 million.
Nearly 73 million refunds were electronically deposited into taxpayer accounts this year. These taxpayers received their refunds at least a week sooner than those receiving a paper check.
Direct deposit refunds accounted for 66 percent of all refunds, up from 62 percent of refunds last year. Overall, the IRS issued 110 million refunds, averaging $2,753 per refund; direct deposit refunds averaged $2,997 per refund.
More than 3 million taxpayers filed their tax returns for free through the IRS Free File program. This year, for the first time, taxpayers could also file directly to the IRS by completing a Form 1040 on IRS.gov; 273,000 taxpayers used this new way to file.
By WebCPA Staff
Electronic tax filing set a new record this year, with 95 million individual federal income tax returns e-filed, up nearly 6 percent from last year’s total of nearly 90 million.
Approximately two out of three taxpayers filed electronically this year, said the IRS. Out of the 141 million returns filed so far this year, over 67 percent were e-filed, compared to 59 percent last year.
Each year, more taxpayers choose to e-file their tax returns. While the total number of tax returns has increased 10 percent during the past decade, the number filed electronically has increased by 168 percent.
Taxpayers who file electronically from a home computer continue to be an increasingly significant segment of those who e-file, the IRS noted. This year, for the first time, more than a third of e-filers filed their returns themselves from a home computer, accounting for approximately 34 percent of all e-filed returns from individuals. More than 32 million returns were e-filed from home computers, up almost 20 percent from last year’s record of 27 million.
Nearly 73 million refunds were electronically deposited into taxpayer accounts this year. These taxpayers received their refunds at least a week sooner than those receiving a paper check.
Direct deposit refunds accounted for 66 percent of all refunds, up from 62 percent of refunds last year. Overall, the IRS issued 110 million refunds, averaging $2,753 per refund; direct deposit refunds averaged $2,997 per refund.
More than 3 million taxpayers filed their tax returns for free through the IRS Free File program. This year, for the first time, taxpayers could also file directly to the IRS by completing a Form 1040 on IRS.gov; 273,000 taxpayers used this new way to file.
Thursday, January 15, 2009
New IRS Free Option
http://www.webcpa.com/article.cfm?articleid=30435
Washington, D.C. (Jan. 15, 2009)
By WebCPA staff
The Internal Revenue Service plans to open its electronic filing season on Friday, Jan. 16, and debut a new service that allows taxpayers to simply fill out forms on-screen and file their taxes for free.
The new service will be available to taxpayers of any income level. It will augment the Free File program, which provides free tax-processing software from 20 different companies to taxpayers whose adjusted gross incomes are $56,000 or less.
The new Free Fillable Tax Forms service is aimed at taxpayers who don't need to go through the interview process included in most tax software packages. They should be familiar with recent tax laws, however, and know which forms to fill out. The on-screen forms let them enter their tax data, perform basic math calculations, sign the returns electronically, print their returns for recordkeeping purposes and electronically file their returns.
The IRS also noted that several tax software vendors are offering free electronic filing options this year. They include Intuit's TurboTax, H&R Block's TaxCut and 2nd Story Software's TaxAct.
"These are tough times, and e-file is the best way for people to get cash in their pocket quickly," said IRS Commissioner Doug Shulman in a statement. "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." Last year, the average tax refund was $2,429.
__________
CAUTION: Taxpayers may still need to file a state income tax return.
Washington, D.C. (Jan. 15, 2009)
By WebCPA staff
The Internal Revenue Service plans to open its electronic filing season on Friday, Jan. 16, and debut a new service that allows taxpayers to simply fill out forms on-screen and file their taxes for free.
The new service will be available to taxpayers of any income level. It will augment the Free File program, which provides free tax-processing software from 20 different companies to taxpayers whose adjusted gross incomes are $56,000 or less.
The new Free Fillable Tax Forms service is aimed at taxpayers who don't need to go through the interview process included in most tax software packages. They should be familiar with recent tax laws, however, and know which forms to fill out. The on-screen forms let them enter their tax data, perform basic math calculations, sign the returns electronically, print their returns for recordkeeping purposes and electronically file their returns.
The IRS also noted that several tax software vendors are offering free electronic filing options this year. They include Intuit's TurboTax, H&R Block's TaxCut and 2nd Story Software's TaxAct.
"These are tough times, and e-file is the best way for people to get cash in their pocket quickly," said IRS Commissioner Doug Shulman in a statement. "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." Last year, the average tax refund was $2,429.
__________
CAUTION: Taxpayers may still need to file a state income tax return.
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