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Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including the popular e-file method for preparing and submitting income tax returns. Just click the tabs at the top of each page or simply scroll to the next page for more. To begin, Click Here.

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Page 1: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press Kit

Welcome to the...

Press Kit

Here you will find an overview of all the products and services offered by Electronic IRS, including the popular e-file method for preparing and submitting income tax returns.

Just click the tabs at the top of each page or simply scroll to the next page for more. To begin, Click Here.

Page 2: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitPurpose of Electronic IRS

Introduction

Purpose of Electronic IRS

History of e-filing

About Free File

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

About the Electronic IRS — Portal to Everything Electronic

The purpose of the Electronic IRS is to provide a central source for all the many online transactions that can be accomplished electronically with the Internal Revenue Service (IRS), whether by individual taxpayers, tax professionals, businesses or others. Over the years, the usage rate of services provided by Electronic IRS has grown tremendously.

For example:

• Forthefirsttimein2006,amajority(52percent)ofindividual taxpayers(68.5million)filedtheirtaxreturnselectronically. Thatnumbergrewtoalmost60percent(80million)in2007.

• In2007,morethan4.7millionbusinessreturnswere filedelectronically.

• Morethan1.4milliontaxpayersenrolledintheIRS’Electronic FederalTaxPaymentSystem(EFTPS)in2007,bringingthetotal number of taxpayers enrolled to pay their federal taxes online orbyphoneto8million.

• Alsoin2007,2.4millionpaymentsweremadebycreditcard. And1.5milliontaxpaymentsweremadeviaelectronic funds withdrawal.

Whether looking for a tax preparer, completing a form, enrolling in a service or checking on a refund, taxpayers can do more through the Electronic IRS. The IRS is working to increase the number of electronic options for all its customers. The goal is to provide easier access and give taxpayers the ability to do more transactions online. Through its modernization efforts and new online product development, the IRS isonitswaytoprovidinganall-electronicIRSthattaxpayerswillfind very valuable.

Page 3: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitHistory of e-filing

Introduction

Purpose of Electronic IRS

History of e-filing

About Free File

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

About Filing Electronically

Filing taxes electronically (IRS e-file)hasquicklybecometheElectronicIRS’mostusedservice.Thisoptionforfilingindividualandbusinesstaxreturnsoffersmanybenefitstousers:

• e-fileismoreaccuratethanpaperfilingandithasanerrorrateof lessthan1percent,therebyreducingthepossibilitythattaxpayers will receive further communication from the IRS.

• e-file is secure.

• e-file offers the option of Direct Deposit, so taxpayers can get their refundsinhalfthetimeofpaperfiling.

• e-fileofferstheconvenienceoffilingtaxreturnsearlyanddelaying paymentaslateasApril15th.

• Inmoststates,taxpayerscanfilefederalandstatereturnsatthe same time.

E-filingindividualincometaxreturnsbeganin1986.Thatyear,25,000individualreturnsweree-filedtotheIRS.

TheRestructuringandReformActof1998statedthattheIRSshouldset goalstohaveaminimumof80percentofallfederaltaxandinformationreturnsfiledelectronicallyby2007.That’sbecauseinadditiontothe benefitsmentionedabove,electronicallyfilingreducesgovernmentcosts.

Afteralmosttwodecadesofincorporatingtechnologicaladvancementsintoitselectronicfilingprograms,theIRSreceivedmorethan80millione-filedindividualincometaxreturnsin2007oralmost60percentofallreturnsreceived.Totalindividualelectronicallyfiledreturnshavehadsolidgrowthinrecentyears,withanannualaveragegrowthrateofover12.8%percentinthepastfiveyears.

Today, almost all forms associated with a tax or information return for individuals,businessesandtax-exemptorganizationscanbefiledandpaidelectronically, thereby saving paper as it eliminates the need to send hard copies to the IRS.

Page 4: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitAbout Free File

Introduction

Purpose of Electronic IRS

History of e-filing

About Free File

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

All the Benefits of e-filing…for Free

MostAmericanscane-fileatnocostthroughaprogramcalled“FreeFile.” Developedin2003throughapartnershipbetweentheIRSandtheFreeFile Alliance,agroupofprivate-sectortaxpreparationcompanies,FreeFileallowsfreeelectronictaxpreparationandfilingforeligibletaxpayers.Forthe2008filingseason,95millionindividualtaxpayerswillbeabletouseFreeFile.Toqualify,taxpayersmusthaveanadjustedgrossincomeof$54,000orless.

The program is accessible only through www.irs.gov. Both new and repeat users must access Free File through this website.

Some companies offer their Free File software in Spanish, in addition to English.Somealsoofferotherfreeservices,suchasfilingextensions,stateincometaxpreparationande-filingservices.Also,taxpayerswhoareeligible for the Earned Income Tax Credit (EITC) can use Free File to claim it.

Page 5: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press Kite-file Benefits for Taxpayers

Electronic Press Kit

Introduction

Individual Taxpayers

e-file Benefits for Taxpayers

What Taxpayers Can Find on www.irs.gov

Self-Prepared, Computer Returns

Using Tax Preparers

Paying Electronically

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Why Taxpayers Should e-file

In2007,morethan80milliontaxpayersfiledtheirreturnselectronically.TheIRSreceivedapproximately136milliontaxreturns,andofthat,almost60percentwerefiledelectronically,makinge-filethemostpopularwaytofileafederal tax return.

Taxpayerscane-filethroughataxprofessionalorbyusingasoftwareprogramandInternetconnectionontheirpersonalcomputer.Iftheymake$54,000orlessayearinadjustedgrossincome,theymayqualifytoelectronicallyprepareandfiletheirtaxreturnsatnocostusingFreeFile.

Therearemanyadvantagestoe-filing.First,becausethereturnistransmittedelectronically,it’sthefastestwaytogetataxreturntotheIRSforprocessing. If taxpayers are due a refund, they can receive it in half the time than by submitting a paper return. Using Direct Deposit, a refund can be deposited directlyintoataxpayer’sbankaccountinaslittleas10days.

Inaddition,e-filinggivestaxpayersfastreassurancethattheirinformationwassafely received by the IRS. When taxpayers use e-file, they will receive an email acknowledgingreceiptofthetaxreturnwithin48hoursofitssubmission.

Fortaxpayerswhomayowemoney,theycane-fileatanytimeanddelay paymentuptoApril15th.

Page 6: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitWhat Taxpayers Can Find on www.irs.gov

Introduction

Individual Taxpayers

e-file Benefits for Taxpayers

What Taxpayers Can Find on www.irs.gov

Self-Prepared, Computer Returns

Using Tax Preparers

Paying Electronically

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Electronic IRS Offers More Than Just e-file

Beyondfindinginformationonhowtofileelectronically,theElectronicIRS is a gateway to all the IRS electronic options available to taxpayers. On the www.irs.gov website, taxpayers can:

• Checkontheirrefundwith“Where’sMyRefund?”

• FindanAuthorizede-file Provider (tax professional)

• Obtain copies of tax returns

• Complete the Earned Income Tax Credit (EITC) eligibility

• Calculate their appropriate withholding

• Obtain or complete online forms and publications

• Sign up for paying taxes electronically

• ObtainanEmployerIdentificationNumber(EIN)online

• Andmore

Page 7: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitSelf-Prepared, Computer Returns

Introduction

Individual Taxpayers

e-file Benefits for Taxpayers

What Taxpayers Can Find on www.irs.gov

Self-Prepared, Computer Returns

Using Tax Preparers

Paying Electronically

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

How e-file Works

Afteranelectronicreturnispreparedandsubmittedviaacomputermodem,anelectronicreturntransmitterconvertsthefiletoaformatthatmeetsIRSspecifications,andtransmitsittotheIRS.

TheIRSthenchecksthereturnandnotifiesthetransmitter(whothen informsthetaxpayer)whetherthereturnhasbeenacceptedorrejected. The acknowledgment message received from the return transmitter will includethetaxpayer’smailingaddress.

If the return is not accepted by the IRS, the transmitter will provide the taxpayer with customer support to correct the return and resubmit it. Taxpayerswhochoosenottouseaself-selectedPINastheirsignature or who have certain paper forms to submit, will need to mail in a paper signature document.

Page 8: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitUsing Tax Preparers

Introduction

Individual Taxpayers

e-file Benefits for Taxpayers

What Taxpayers Can Find on www.irs.gov

Self-Prepared, Computer Returns

Using Tax Preparers

Paying Electronically

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Tax Professionals Can Also e-file Your ReturnsManytaxpayersuseataxpreparertosubmittheirreturns.Taxprofessionalswhoareacceptedintotheelectronicfilingprogramarecalled“AuthorizedIRS e-fileProviders.”

Aftertaxpayersapproveandsigntheirelectronictaxreturns(byusinga self-selectedPINorbysigningIRSForm8453),thepreparertransmitsittotheIRS or a third-party transmitter who then forwards the entire electronic record to the IRS for processing.

Once received by the IRS, the return is automatically checked by computers for errors and missing information. If it cannot be processed, it is sent back to the transmitterforresolution.Aftercorrection,thetransmitterresendsthereturn.Within48hours,theIRSsendsanacknowledgmenttothetransmitterstatingthereturnwasacceptedforprocessing.Thisisproofoffilingandassurancethatthe IRS has the taxpayer return information.

Taxpayers due a refund can expect to receive it approximately three weeks from the acknowledgment date. However, they can get their refund faster with DirectDeposit(inaslittleas10days).

Taxpayerswhoowemoneycanprepareandfiletheirreturnelectronicallyanytimeduringthefilingseason;however,sendingthepaymentforabalanceduebythetaxduedate,i.e.,April15,2008,isstillthetaxpayer’sresponsibility.Sotaxpayerscan“filenow,paylater.”

Taxpayers may pay the balance due to the IRS by direct debit (automatic withdrawal) directly from their bank, by credit card or by check. Taxpayers who make subsequent quarterly estimated tax payments may also enroll in the Electronic Federal Tax Payment System (EFTPS) to make those payments online or by phone in the future.

If you use a tax preparer, be sure to talk to your preparer and request e-file.

Page 9: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitPaying Electronically

Introduction

Individual Taxpayers

e-file Benefits for Taxpayers

What Taxpayers Can Find on www.irs.gov

Self-Prepared, Computer Returns

Using Tax Preparers

Paying Electronically

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Three Easy Ways to PayIf taxpayers owe the IRS, they have three options for making their payment electronically:

1. They can e-file any time during the tax season and delay payment through automated bank account withdrawal (EFW) until the tax due date.

2. Taxpayers can pay by credit card.

3.TaxpayerscanenrollintheDepartmentofTreasury’sElectronicFederal Tax Payment System (EFTPS) (www.eftps.gov) to make any subsequent 1040ESestimatedquarterlytaxpayments.EFTPSallowstaxpayerstopay by Internet or phone.

Page 10: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press Kite-file Benefits for Tax Professionals

Introduction

Individual Taxpayers

Tax Professionals

e-file Benefits for Tax Professionals

Why Tax Professionals Should e-file

e-Services Available on www.irs.gov

Incentive Programs

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Through enhancements to its products and website, the IRS is making it easierthaneverfortaxprofessionalstotakecareofclients’taxeselectronically.AlmostallIRSformscannowbefiledandpaidelectronicallyforindividuals,businesses and tax-exempt organizations.

Butthere’smoretotheElectronicIRSforpreparersthanjustinformation about e-file. The number of electronic options is increasing every year, helping toreducethetaxprofessional’stimeandimprovethetimelinessandaccuracyof tax returns.

Tax professionals can use Electronic IRS as a gateway to:

• Register to use e-Services

• ApplytobecomeanAuthorizede-file Provider

• ObtainanEINviatheInternetEINprogram

• Submit information returns through the FIRE program

• Get free EFTPS Batch Provider Software to make multiple client tax payments from their own computer

• Review current and past IRS documents in the Electronic Reading Room

• Accessphonerepresentativesthroughe-HelpServices

• Subscribe to a variety of electronic alerts and newsletters

• Check on client refunds

• Participate in monthly Tax Talk webcasts

• Andmore

Tax professionals can register for e-Services at www.irs.gov/efile, click on the Tax Professionals page, and then e-Services.

Page 11: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitWhy Tax Professionals Should e-file

Introduction

Individual Taxpayers

Tax Professionals

e-file Benefits for Tax Professionals

Why Tax Professionals Should e-file

e-Services Available on www.irs.gov

Incentive Programs

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Moreandmoretaxprofessionals(andtheirclients)areseeingthesignificantbenefitsofusingIRSelectronicservices.In2007,authorizedproviderse-filed55.7millionreturns,up8.2percentfromthepreviousyear.

BybecominganAuthorizede-file Provider and transmitting tax returns directly to the IRS or through a third-party transmitter, tax professionals offer their clients a valuable service and reduce IRS problems in the long run. In addition, taxpayers receive their refunds faster (especially if they choose Direct Deposit) and fewer errors are encountered in processing their returns.

Also,ifafollow-upwiththeIRSisneededorifproblemshavetoberesolved, tax professionals have access to information in seconds, rather than days or weeks.Thisisnotonlyabenefittothepreparer,butalsotothetaxpayerwhoappreciates having issues resolved much more quickly.

Page 12: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press Kite-Services Available on www.irs.gov

Introduction

Individual Taxpayers

Tax Professionals

e-file Benefits for Tax Professionals

Why Tax Professionals Should e-file

e-Services Available on www.irs.gov

Incentive Programs

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

The IRS provides tax professionals with a full suite of web-based e-services available at www.irs.gov. Improvements to and expansion of these e-services are offered every year, so preparers are encouraged to visit the site often.

Thesee-servicesaredesignedtohelptaxprofessionalshandlethemajor componentsoftaxpreparationandfiling,whileimprovingthespeedwithwhich the IRS responds. Some of these services are:

• Registration:Anytaxprofessionalswhowishtousethee-services productsmustfirstregister.Onceregistered,theywillreceivea confirmationcodeviamailwithin10-14daystotheirhomeaddress.Next,theywilllogintoe-services,confirmtheregistrationandbeginusing the services.

• e-file Application:Theonlinee-fileApplicationreplacesthepaper processforsubmittingForm8633,“ApplicationtoParticipateintheIRSe-fileProgram.”Inthisway,applicationscanbemaintainedandupdatedelectronically.Also,anew“delegationofauthority”featureallowsprincipalsorresponsibleofficialsofthefirmororganization to delegate e-services products to their employees.

• Preparer Tax Identification Number (PTIN): Tax professionals may choosetouseaPTINinsteadofdisplayingtheirownSocialSecurityNumberonreturnstheyprepareforclients.ThePTINapplication allowsapreparertoapplyforandreceiveaPTINonline.Theyalso havetheoptionoflookingupaforgottenPTINandcanrequestthataPTINcardbesenttothem.Thisprocesspreviouslytookweekstocomplete, but can now be done in seconds.

• Taxpayer Identification Number Matching (TIN Matching): TINMatchingisusedtomatchtaxpayers’identificationnumberswiththeIRSdatabase.Itislimitedtopayerswhofileanyofthefollowingsixinformationreturnsthataresubjecttoback-upwithholding:1099-B,INT(Interest),DIV(Dividend),PATR(Patronage),OID(OriginalIssue Discount),MISC(Miscellaneous).InordertoparticipateinTINMatching,payersmustbelistedintheIRSPayerAccountFile(PAF)database.

Page 13: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitIncentive Programs

Introduction

Individual Taxpayers

Tax Professionals

e-file Benefits for Tax Professionals

Why Tax Professionals Should e-file

e-Services Available on www.irs.gov

Incentive Programs

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Beyond these basic e-services, tax professionals who are active participants in the IRS e-fileprogramandelectronicallyfilemorethanfiveindividual or business tax returns in a season are eligible to use the following incentive programs:

• Disclosure Authorization (DA):AllowsthirdpartiestoelectronicallysubmitForm2848,“PowerofAttorney(POA),”andForm8821,“TaxInformationAuthorization.”TaxprofessionalswillreceiveimmediateverificationthatthePOAhaspostedtotheIRSCentralizedAuthoriza-tion File and they can begin using other incentive products. However, theymusthaveasignedPOAintheirbusinessfilespriortosubmittingthe form electronically. Tax professionals can also view all previous authorizationsonfileandupdatetheinformationonline.

• Transcript Delivery System (TDS): Enables authorized practitioners torequesttaxtranscriptsandaccountinformationontheirclients’accounts.

• Electronic Accounts Resolution (EAR): Enables the authorized third party to submit an account-related inquiry electronically to the IRS, 24hoursaday,sevendaysaweek.ThebiggestadvantagetousingEARisthattheinquirywillremainwiththesameIRSCustomerServiceRepresentative from beginning to end.

Page 14: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitOther Taxpayer Groups

Introduction

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Businessesandotherinterestedpartiescanfindawealthofinformationaboutavailable electronic services at www.irs.gov,includingthoserelatedtoe-filing.Some of these services, listed by type of group, are shown below.

Large Businesses

• Learniftheyarerequiredtofileelectronically

• FindanAuthorizede-fileProvider

• Sign up to pay electronically

• FileW-2selectronically

• EnrollintheDepartmentofTreasury’sElectronicFederal Tax Payment System (EFTPS) to make Federal Tax Deposits

Small Businesses

• ObtainanEmployerIdentificationNumber(EIN)online

• Sign up to pay electronically

• FindanAuthorizede-file Provider

• FileW-2selectronically

• Enroll in EFTPS to make Federal Tax Deposits

Software Companies

• Obtainspecificationsforintegratingelectronicservices

• Register to receive electronic alerts

• Reviewrequirementsforelectronicfilingandpayingsoftware

• Downloadschema,guidelines,samplefilesandtestcases forelectronicfiling

Tax-Exempt Organizations

• Learniftheyarerequiredtofileelectronically

• FindanAuthorizede-file Provider

• Download forms and publications

• Subscribe to an email newsletter

• Check whether an organization is eligible to receive deductible charitable contributions

• FileW-2selectronically

Page 15: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitFast Facts

Introduction

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

FACT ... TheIRSprocessedmorethan89milliontaxreturnselectronically in2007.

FACT ... In2007,morethan80millionindividualtaxpayers(oralmost60 percentoftheU.S.population)e-filed.

FACT ... Morethan9.5millionbusinessreturnswerefiledelectronically in2007.

FACT ... 120,000taxprofessionalsuseIRSe-Services,aweb-based suite of services to help prepare, research and submit tax returns electronically.

FACT ... Morethan1.4milliontaxpayersenrolledintheIRSElectronic FederalTaxPaymentSystem(EFTPS)infiscalyear2007.

FACT ... IRSreceived3.4millioncreditcardpaymentsin2007.

FACT ... During2007,61.4millionrefundsweredirectlydeposited.

FACT ... In2007,theaverageDirectDepositrefundwas$2,698.

FACT ... 1.5milliontaxpaymentsweremadeviaelectronicfunds withdrawalfrombankaccountsin2007.

Page 16: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitQuestions and Answers … About Electronic IRS

Introduction

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Questions and Answers… About Electronic IRS

Questions and Answers… About IRS e-file

Press Releases/Articles

Q: What is Electronic IRS?

A: ElectronicIRSisthecentralizedsourceforfindingalltheelectronic options available on www.irs.gov. On the home page of the IRS web site, click on the Electronic IRS logo to be taken to a page with an overview of all the electronic tasks that can be accomplished online.

Q: What kinds of things can I do online as a taxpayer?

A: Beyondpreparingandfilingtaxeselectronically,theIRSofferstaxpayerssubstantially more through the Internet. For example, taxpayers can:

• Checkontheirrefundwith“Where’sMyRefund?”

• FindanAuthorizede-file Provider

• Obtain copies of tax returns

• Calculate the appropriate withholding

• Complete Estimated Income Tax Credit (EITC) eligibility

• Obtain or complete online forms and publications

• Sign up for paying taxes electronically

• ObtainanEmployerIdentificationNumber(EIN)online

• Andmore

Q: What kinds of things can I do online as a tax professional?

A: Through the Electronic IRS, tax professionals can complete a variety of tax functions. They can:

• Register for e-services to access the many online IRS tools

• ApplyonlinetobecomeanAuthorizede-file Provider

• ObtainaPreparerTaxIdentificationNumber(PTIN)

• MatchTaxpayerIdentificationNumberswiththeIRSdatabase

• SubmitDisclosureAuthorizationformselectronically

• Obtain tax transcripts electronically

• Submit electronic inquiries regarding taxpayer problems

• Andmore

Page 17: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitQuestions and Answers … About IRS e-file

Introduction

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Questions and Answers… About Electronic IRS

Questions and Answers… About IRS e-file

Press Releases/Articles

Q: What is e-file?

A: IRS e-file is the program that allows taxpayers and tax preparers to send federal and most state tax returns electronically through software programs or online. Software programs are available for purchase in stores, through online companies and with most tax preparers.

Toe-file,taxreturninformationisenteredintothecomputerprogram,checked for completeness and then transmitted electronically to the IRS via modem, broadband and Internet connection.

Q: Is there a charge to e-file?

A: TheIRSdoesnotchargeafeetofileelectronically.However,manysoftwareproviders and tax preparers do charge a fee for processing returns electronically.

Q: What are the benefits of using e-file?

A: IRS e-filehasquicklybecomethemostusedoptionforfilingindividualandbusinesstaxreturns,asitofferssomanymorebenefitsthanfilingwithapaper return:

• e-fileismoreaccuratethanpaperfilingandhasanerrorrateoflessthan1percent,therebyreducingthepossibilitythattaxpayerswillreceive an error letter from the IRS.

• e-file offers the option of Direct Deposit so refunds come in as littleas10days.

• e-fileofferstheconvenienceoffilingtaxreturnsearlyanddelayingpayment up until the due date.

• e-fileallowsfederalandstatereturns(formoststates)tobefiled at the same time.

• e-file acknowledges receipt of the tax return by email within 48hoursofsubmission

• e-file saves paper.

• e-file is safe and secure.

• e-file is easy to use.

Q: I prepare my taxes using tax preparation software. Then I print the forms and mail them to the IRS. Do I get the same benefits as someone who submits their return electronically?

A: No.Formsthatareelectronicallyprepared,butthenprintedandmailed,are treated the same as forms prepared by hand. The IRS must re-key the information,whichmayincreasethechancefortranscriptionerrors.Also,ittakesweekslongerfortheIRStocontactpaperfilersabouterrorsorprovidea tax refund.

Q: If I e-file do I need to submit Forms W-2, W-2G, W-2GU and Form 1099-R to the IRS?

A: No,therequirementtoattachFormsW-2,W-2G,W-2GUandForm1099-Rhasbeeneliminatedforane-filedreturn.

However, taxpayers should keep records of these attachments with a copy of their tax return.

Q: Why are forms more accurate when they are e-filed?

A: There are several reasons:

• Electronically submitted forms are automatically checked by the IRS. If there is an error or missing information, the IRS will send back the form and allow the taxpayer or tax preparer to make the changes and resubmit the form.

• Data can be saved from year to year, dramatically reducing the chance of transcription errors.

• Data goes into the IRS system exactly as it was submitted. Nore-keyingofinformationisnecessary.

• Mosttaxsoftwaredetectsmatherrorsandothercommonmistakesbeforethereturnisfiled.TheIRSdoesadditionalchecksaswellone-filedreturns.

(Continue to next page)

Page 18: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitQuestions and Answers … About IRS e-file

Introduction

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Questions and Answers… About Electronic IRS

Questions and Answers… About IRS e-file

Press Releases/Articles

Q: Is there a greater chance that e-filers will be audited?

A: No.Thereisnogreaterchanceofbeingauditediftaxpayerse-file.

Q: Why do refunds come more quickly with IRS e-file?

A: Because data goes directly into the system, it speeds up the processing timeforeachtaxreturn.Andiftaxpayerselecttohavetheirrefunds deposited directly into their bank accounts, the time it takes to receive arefundisdramaticallydecreasedfromweekstoaslittleas10days.

Q: How can I pay electronically if I owe?

A: Ifthereisabalancedueonthetaxreturn,taxpayerscanstillfile electronically through e-file and then schedule a payment for the tax due date. Payments can be made via automated withdrawal from a checkingaccount,bycreditcardorbyenrollingintheTreasury’sfreeElectronic Federal Tax Payment System (EFTPS) to make the balance due payment and any subsequent estimated tax payments electronically (by phone or online).

Q: Which tax preparers can e-file taxes on behalf of clients?

A: Tensofthousandsoftaxpreparersnationwideare“Authorizede-file Providers.”TaxpayerscancheckwiththeirtaxpreparerorvisitElectronicIRSat www.irs.govtofindoneintheirarea.

Page 19: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press KitPress Releases/Articles

Introduction

Individual Taxpayers

Tax Professionals

Other Taxpayer Groups

Fast Facts

FAQs

Press Releases/Articles

Page 20: Press Kit - Internal Revenue ServiceElectronic Press Kit Welcome to the... Press Kit Here you will find an overview of all the products and services offered by Electronic IRS, including

Electronic Press Kit

Inroduction to Free File

Electronic Press Kit

About Free File

For the sixth straight year, eligible taxpayers can use Free File to prepare and filetheirfederalincometaxreturnselectronicallywithoutcharges.Thereare no hidden fees. This program was developed by the Internal Revenue Service (IRS)inpartnershipwiththeFreeFileAllianceLLC,agroupofindustryleadingprivate-sector tax preparation companies.

FreeFileisavailabletoeveryonewhoearns$54,000ayearorless.That’s70 percentofallfilers,roughly97milliontaxpayers.FreeFileisavailable24hours aday,sevendaysaweek,beginningmid-January2008.Theprogramis available in both English and Spanish.

Morethan19milliontaxreturnshavebeenpreparedandsubmittedthroughFreeFilesinceitdebutedduringthe2003filingseason.

TouseFreeFile,individualsmustfirstgototheIRSwebsite,www.irs.gov, click on“FreeFile”,thenpressthe“StartNow”buttonandchooseataxpreparationcompany from the list provided. (Free File is not available by going directly to a company’swebsite.)Notallcompaniesofferservicestoeveryone.Filersshouldbesuretoreadtheofferdescriptiontofindwhichcompanybestfitstheirneeds.Onceacompanyisselected,usersclickonthelinktothatcompany’swebsiteandbeginpreparingtheirreturn.FreeFilealsohasa“GuideMetoaCompany”feature that will assist taxpayers in selecting a company that offers services tailored to their particular situation.

AlthoughFreeFileisavailableonlyforfederalincometaxreturns,some participatingFreeFileAlliancecompaniesalsoofferstatetaxreturn preparationande-filingatnocharge.Thoseservicesarenotedinthe

FreeFilesectionofthosecompanies’websites.

FactsFree File is easy to use, safe and secure and delivers a fast refund, in as little as

10dayswithDirectDeposit.ThissectiondescribesFreeFileandwheretofind

more information about the program.

Frequently Asked QuestionsTheFAQssectionprovidesmorein-depthanswerstorecurring

questions that have been asked over about Free File.

Free File Fast FactsQuickfactsaboutFreeFileareavailable.Theyincludeaquickdescriptionof

theprogram,benefits,eligibilitycriteria,statisticsonFreeFileusageandwhere

tofindmoreinformation.

News Releases and PSAsAllnewsreleasesrelevanttoFreeFilewillappearinthissection.

Inaddition,youwillfindradiopublicserviceannouncements

available for use and distribution.

ArticlesThe following articles are provided free of charge by the Free File

program office of the Internal Revenue Service. The copy may be

used in print and online media to help explain the Free File program.