In an effort to modernize and streamline its operations, the IRS has unveiled plans to achieve “paperless processing” for tax returns by 2025. In a press release Wednesday, the agency lamented how it receives about 76 million paper tax returns and forms each year, and that “its limited capability to accept these forms digitally has prevented the IRS from delivering the world-class service taxpayers deserve.” By reducing reliance on traditional paper-based methods, the IRS aims to improve taxpayer experiences, increase data accuracy, and expedite refund processing. Here’s what IRS’s new paperless processing initiative means for you as a taxpayer.
Shifting to digital federal tax returns
Traditionally, taxpayers would submit their returns and supporting documents via mail, leading to, say, less-than-ideal processing times—not to mention potential errors that come with manual handling. With this initiative, taxpayers are encouraged to file their returns electronically through the IRS’s secure online platform or through authorized tax software providers.
However, the IRS notes that taxpayers who want to submit paper returns and correspondence can continue to do so into the 2024 filing season.
The benefits of e-filing your tax return
By embracing digital filing, the IRS aims to achieve faster processing times, which means faster tax refunds for eligible taxpayers. With paper returns, processing times could stretch for weeks, while electronic filing typically results in refunds within a matter of days.
As the agency puts it, “once paper returns are digitized, extracting the data will enable IRS customer service employees to more quickly and accurately answer taxpayer questions and resolve issues.”
The IRS has invested heavily in securing its online filing systems to protect taxpayer information from potential cyber threats and identity theft. E-filing provides a secure channel for transmitting sensitive data, as encryption protocols are in place to safeguard the data during transmission and storage. Taxpayers can access their filed returns and relevant documentation online at any time, making it more convenient for record-keeping and future reference. Additionally, e-filers often receive real-time feedback regarding potential errors or missing information, reducing the likelihood of return rejections and subsequent delays.
What if you don’t have access to the internet?
The IRS recognizes that not all taxpayers have access to the internet or may face challenges with digital literacy, and there will still be alternative methods of filing and assistance. Free File Fillable Forms are available for taxpayers who prefer a digital option but do not require extensive guidance. Additionally, local IRS offices and partner organizations offer free tax assistance programs for those who need help navigating the new e-filing process.
“This paperless processing initiative is the key that unlocks other customer service improvements,” U.S. Treasury Secretary Janet Yellen said in a speech on Wednesday. “It will enable taxpayers to see their documents, securely access their data and save time and money.” Hopefully, your next filing season will be smoother than it’s ever been before—not that that’s saying much.
