Should I E-File My IRS Return?

If you have been filling out your individual income tax returns and mailing them to the Internal Revenue Service each year, you are a member of a vanishing minority of U.S. taxpayers. During the 2023 tax season, more than 134 million of the 143 million returns were filed electronically, meaning almost 94% of taxpayers e-filed for the year.

While there are still some situations where you are still required to submit paper versions of income tax returns to the IRS, the number decreases each year as the IRS adds to its e-file options.

There are numerous reasons why most tax professionals and the IRS recommend that taxpayers e-file their returns each year. They include:

• Faster tax refund processing for taxpayers who e-file. The IRS gets refunds to 90% of e-filers within three weeks.
• E-filing reduces the processing errors that occur when documents are scanned or processed manually.
• The IRS's e-file system meets strict security guidelines. The agency works closely with security professionals to protect tax information.
• Taxpayers with low to moderate incomes can free file online using popular tax preparation software.
• There is the added convenience of using online tax software to prepare and submit tax forms from the taxpayer's home computer or smartphone.
• There are a variety of payment options, including making your tax payment by credit card or debit card or direct deposit from a checking or savings account. You can also set up an installment payment plan.
• If you are using tax preparation software, it will often use the information from your federal income tax return to prepare your state return and file it with your state's Department of Revenue.
• The IRS will often acknowledge that it has accepted your return within minutes.

When Should You Paper File?

Despite the IRS's efforts to expand its e-filing capabilities, there are still some times when you should still file a paper copy of your return. They include situations where:

• If you need to attach documentation to provide additional information that can't be included in an electronic tax return or to substantiate a position taken on your return, e-file is not for you.
• If the IRS has rejected your e-filed return and you can't correct the issue using the agency's online resources, file a paper copy. If you are filing a paper return after having your e-filing rejected, be sure to get it postmarked by the due date to avoid late filing penalties.
• You should mail your return if you are requesting innocent spouse relief, which must be claimed using a mailed Form 8857, Request for Innocent Spouse Relief.
• Despite the many benefits of e-filing, the IRS can't require you to do so. if you don't want to e-file.
• Some special tax situations still require that you submit a paper return, such as when your business elects to be taxed as an S corporation.

Until recently, the IRS required that amended returns be filed by mail, but during the COVID-19 pandemic the IRS began accepting e-filed amended individual returns for the 2019 tax year. However, the agency still does not accept e-filed amendments to partnership tax returns.

Still Have Questions? Talk to a Lawyer

If you are unsure about whether you can take advantage of e-filing, a local tax lawyer can help. A tax attorney can assess your personal and financial situation to help you determine whether the IRS will allow you to file electronically or if you need to submit a paper return.