Logll Tech News โ The Internal Revenue Service (IRS) has announced a significant move towards a paperless future for taxpayers, aiming to achieve paperless processing for all tax returns by the year 2025.
- The IRS Paperless Processing Initiative, funded by President Biden’s Inflation Reduction Act of 2022, is expected to eliminate up to 200 million pieces of paper annually, expedite refunds, and cut processing times in half.
US IRS to allow full digital document submissions for 2024 tax season https://t.co/Im0O3iiFES pic.twitter.com/Hu0PSrdlgf
— Reuters (@Reuters) August 2, 2023
๐ Transitioning to a Paperless Future
Starting with the 2024 filing season, most taxpayers will have the option to go entirely paperless. This means that taxpayers can digitally submit all correspondence, including non-tax forms. By taking this step, the IRS estimates that over 94 percent of individual filers will no longer have to mail paper tax forms or documents, saving approximately 125 million paper documents annually.
๐ฐ IRS Sets Sights on a Digitized Future: 150 More Forms to Go Digital by 2025
The Internal Revenue Service (IRS) is not just stopping at a partial shift towards digitization. By the 2025 filing season, the IRS has ambitious plans to expand its digital offerings to include an additional 150 of the most commonly used non-tax forms, all available in mobile-friendly formats. This move comes as a recognition of the fact that approximately 15 percent of Americans solely rely on their phones for internet access, and the IRS aims to cater to this tech-savvy audience.
But that’s not all. The IRS is going all-in on its digital transformation. Starting from the 2024 filing season, all paper-filed tax and information returns, totaling an estimated 76 million documents annually, will be processed digitally upon receipt. This measure is expected to significantly expedite processing times and reduce delays for taxpayers.
Moreover, the IRS is committed to bringing further efficiency to its correspondence handling. Approximately 60 million paper documents, including non-tax forms and notice responses, will also be recorded digitally, streamlining the entire process. This move will not only save time and resources but also contribute to reducing paper waste, making it a win-win situation for taxpayers and the environment.
The IRS’ digital push is in line with the broader vision of creating a seamless and user-friendly experience for taxpayers while ensuring accuracy and accountability. With these developments, the IRS is firmly marching towards a digitized future for tax filing and administration.
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๐ฑ Accessing Older Filing Data
The IRS is not only focusing on current filings but also on making older filing data more accessible. As part of the Paperless Processing Initiative, the IRS plans to digitize up to one billion historical documents, which will make it easier for customer service agents and taxpayers to access older filing information.
๐ก Advantages of Paperless Processing
The shift towards a paperless system brings several advantages for both taxpayers and the IRS. First and foremost, it will help eliminate errors stemming from manual data entry, leading to more accurate processing. Moreover, it will enable the IRS to allocate more resources towards enhancing taxpayer support. Currently, customer service employees face challenges in accessing information from paper returns and other correspondence submitted by mail. Digitization and data extraction will empower them with the information they need to better serve taxpayers.
๐ผ Holding Corporations Accountable
In addition to streamlining operations and enhancing customer service, the IRS believes that digitization will aid in holding billionaires and corporations accountable. With an improved data platform and advanced analytics, data scientists will be able to implement pattern recognition methods to pursue cases that address the tax gap. This includes investigating wealthy individuals and large corporations that may be using complex structures to evade taxes they owe.
๐ฎ The Future of Tax Filing
The IRS Paperless Processing Initiative represents a significant step forward in modernizing tax filing systems and improving efficiency. By reducing reliance on paper documents and manual data entry, the IRS aims to provide a seamless, digital experience for taxpayers while ensuring accuracy and accountability in the tax system.
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FAQs:
The IRS is moving towards paperless processing to eliminate errors from manual data entry, speed up processing times, and allocate more resources to enhance taxpayer support.
The option for paperless tax filing will be available starting with the 2024 filing season.
For most taxpayers, there will be no need to mail any paper tax forms or documents once the paperless option is available.
Digitization and data extraction will provide customer service agents with easy access to information from digital returns and correspondence, allowing them to better serve taxpayers.
Yes, the IRS aims to have mobile-friendly digital formats for the most commonly used non-tax forms, recognizing that many Americans rely solely on their phones for internet access.
With an improved data platform and advanced analytics, data scientists can implement pattern recognition methods to pursue tax gap cases, including those involving wealthy individuals and large corporations using complex structures to evade taxes.