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01.28.21

Filing 2020 income tax returns electronically is the way to go

BY , Income Tax Department

As of December 25, 2020, the Internal Revenue Service had 6.9 million individual income tax returns filed in hard copy remaining to process, including some returns that were filed as long ago as April 15, 2020.

While the IRS is re-allocating these unprocessed returns within its network of processing centers to help reduce the backlog, it will still take a significant amount of time for IRS staff to open, review, and process all 6.9 million returns.

With the 2020 tax season about to begin, it's time to carefully consider how you will file your individual income tax return with the IRS this year. We recommend that you file your 2020 income tax return electronically. Electronic filing has many benefits for a taxpayer:

Faster processing. An electronically filed return does not have to be mailed, received, opened, and entered into the IRS system for processing to begin. As soon as your electronic return is received by the IRS, your data is in the IRS system and processing of your return begins instantaneously.

Faster refunds. An electronically filed return is virtually mistake-free, which allows the IRS to process your tax refund faster. You usually receive your refund within 10 to 14 days if you opt for direct deposit.

Payment options. Payment options include credit or debit card, debit from your bank account ("Direct Pay"), Electronic Federal Tax Payment System ("EFTPS"), or a paper check using a payment voucher. Taxpayers also can file electronically earlier than April 15, but arrange for any payment due to be paid on the filing deadline.

Security. Software companies and tax preparers use strict security guidelines and the most up-to-date encryption technology. You will receive an acknowledgment from the IRS within 24 to 48 hours that your return has been accepted or rejected.

Accuracy. The electronic filing software eliminates math errors, and the question-answer format makes it easier to file an income tax return that contains all required information.

Convenient. A taxpayer can purchase software to self-prepare a return for electronic filing or hire a professional tax preparer to prepare and electronically file the return on the taxpayer's behalf. In 2020, if your income is less than $72,000, you can prepare and electronically file a return using IRS Free File at IRS.gov.

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Author

Christopher F. Caldwell, EA

Professional Specialist

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