mandatory efiling

[erchess]

1. Doesn't this kick in for 2010 for those of us who file over 100 returns?

2. How will returns that currently get rejected and mailed be handled under the new rules?

[taxea]

I don't think there will be a problem if the rejection is because the return did not qualify for e-filing.

[David1980]

I don't think there will be a problem if the rejection is because the return did not qualify for e-filing.

I agree. If it's something that cannot be fixed and you paper file it, you shouldn't have any problems. Though, I would probably make sure your software has a nice report of rejected tax returns so you can show you attempted to efile stuff that should have been efileable. Forms that cannot be efiled (5405 page 1 for example) you shouldn't need anything like that, as they simply won't take it electronically.

The IRS does have a pretty helpful efile help desk phone number you can call for help with rejected tax returns.

[JohnH]

I saw on another forum that and IRS representative stated there would be a waiver available for clients who prefer not to e-file. I hope he heard that correctly. None of my clients are interested in e-filing.

[David1980]

I saw on another forum that and IRS representative stated there would be a waiver available for clients who prefer not to e-file. I hope he heard that correctly. None of my clients are interested in e-filing.

I also recall reading that if all the clients for a specific preparer opt out, they're going to look into that. But I don't believe this first year there's any downside at all, or any punishment? So somewhat of an empty threat, though perhaps they'll send you a polite letter?

[MLINDER42]

E-file

Just returned from IRS FORUM even if you are going to let all your clients opt out you should obtain an efin .They will not except not any excuse for not having the ability to e-file.It is hard for me to believe that none of your clients will e-file.I do over 2750 returns in 2 locations and e-file eery return that will e-file.

[dyne]

I was reluctant to e-file until my STATE required it three years ago. Now IRS requires
retuns to be e-filed. E-filing is MUCH better once you learn to do it. It consumes less
time and paper and toner. I e-file all returns and taxpayers who wish NOT to e-file are
sent elsewhere. I like the fact that ACKS are received proving that the returns have been
received by IRS and the state. I encourage everyone to start e-filing.

[Uncle Sam]

Mandatory E-Filing

The one aspect virtually everyone overlooks is -

Our professional responsibilities ORIGINALLY were to provide tax advice and preparation based on legal tax laws, and to see that clients' taxes are at the lowest legitimate amounts.

We NOW are burdened with the responsibility of FILING the return for the client.

Do doctors send office staff personnel to your house to see that you take your medication as prescribed?

Do insurance agents actually make a physical inspection of your checkbook to see if premiums are paid on time?

I guess the advertising IRS can use is "15 Minutes of e-filing can save you 15 years to life"

[gkaiseril]

Do doctors send office staff personnel to your house to see that you take your medication as prescribed?

Would you pay your doctor for that service?

Do doctors deliver pills in the hospital? No! There are Registered Nurses that can and should be doing that.

Years age certain public health agencies sent nurses out to make sure individuals with a respiratory disease where taking the prescribed medicine. But because of the perceived cost savings, this is no longer being done and that disease has now become more virulent because the entire prescribed course of treatment was not followed. The disease is Tuberculoses! And like all diseases it is an equal opportunity infector.

Do insurance agents actually make a physical inspection of your checkbook to see if premiums are paid on time?

Insurance companies have deposit and payment records and can ask for a copy of the paid check or payment confirmation.

Electric filing was developed for the cost savings the taxing agencies could realize. There is no need for data entry personnel, mathematical checks and accuracy is done at the front end and can be easily checked without human intervention, the computer can check to make sure all the necessary forms are included or prepared, the transmission can verify all the required forms are included. The receipt of the data can be confirmed. The provided data can be processed faster and refunds delivered faster by over 7 days. The computer even can do complex math when I am very tired and do it right.

The big issue with electronic filing is congress pushing the IRS to have the preparers do more front end screening of EIC compliance and not providing very specific test as to required minimum income. But look at how many public officials are being charged with blatant tax fraud and how they react to those charges. Instead of being agents of our clients, we are becoming agents of theIRS.

[MAJ]

15 minutes...

I guess the advertising IRS can use is "15 Minutes of e-filing can save you 15 years to life"

Gotta love that quote.... I can't say E-Filing is a BURDON. I like the E-Filing aspects. Simplies the process. I had a client (1065 Partnership) get all in my face a few years back (I don't E-File Business Returns - cannot justify the difference is cost of software) after they got a letter from the State. They said the paperwork was never filed. They suspended the corporation. We can't work . What did you do?
I'm like - WHoooh... WTF are you talking about (okay didn't say that excactly)?? That doesn't even sound right. I was swamped and we couldn't settle and appointment for about a week. Give me the paperwork so we can review and figure out what's going on.
They come over and this guy gets in my face saying he was going to call the State on me and tell them how it's all my fault. Blah Blah Blah..
I'm like - Please have a seat and let's review what we know. Okay. You came over and we reviewed your partnership return. We all agreed on the numbers, deductions, etc, Correct. He's like Yes. Then I printed out three copies of your partnership and personal returns. We good so far. Yup! they replied. We Electronically filed your personal returns and I handed YOU three copies of your Partnership return on revew. One for you, One for you, and one all tucked pretty in envelopes which you signed, correct. Yes, that sounds about right. You told me upon leaving that you were dropping the return off at the post office on the way home, correct? Yes. Did you!? Yes. Well then I don't understand. The moment I handed hose copies & mailable copy to you my responsibilities were done. How does this fall back on me/ -- The looked puzzled - brought out their paperwork from the state... They never paid to renew their Corporating... My fault! un-huh!

Had that return been electronically filed & it didn't go - yea.. but you? Sorry Charlie...

[oceanlovin'ea]

I Love efiling

I really don't understand the objection some of you have to efiling tax returns. It is in your computer already. It takes less than 2 mintutes to send the transmission. you get your acceptance within a day or rejection if that is the case. Then your client knows something needs to be fixed.

I don't ask my clients if they want to electronically file. I just tell them that I will electronically file the return and the benefits to them. They are happy to have the deed done. No need to run to the post office.

I think it is great. Try it. You'll like it. really

Linda

[Uncle Sam]

Mandatory E-Filing

Seems that some of you don't understand the liability you're assuming by e-filing.

It's more than just clicking a button - and presto - the return is filed - and in instances where the banking is done electronically as well, you're now in the banking business.

It shouldn't be my responsibility as a paid preparer to be held responsible for a client's tax filing, and the RALS and whatever marketing gimmick comes along.

Yes - e-filing has its benefits - I do agree - but it also creates new problems.

[JohnH]

Absolutely correct!

[Burke]

I wholeheartedly agree. You cannot imagine how unperturbed I am when all the preparers are screaming about the efile rejects, the constant software updates for efiling issues. and certain forms not available, and when efiling is going to be approved in this or that state, etc, etc during the first 1-2 months of tax season. But, I know its coming, just postponing the inevitable.

[lenboush]

I wholeheartedly agree. You cannot imagine how unperturbed I am when all the preparers are screaming about the efile rejects, the constant software updates for efiling issues. and certain forms not available, and when efiling is going to be approved in this or that state, etc, etc during the first 1-2 months of tax season. But, I know its coming, just postponing the inevitable.

I view the rejects as an opportunity to serve my clients, since most of the problems identified by the rejection are problems that would either slow down their refund or are problems that would generate a letter from the IRS that I would have to be dealt with later anyway.

I think it is VERY important to note that the people screaming about rejects almost always fall into either one of two categories. They are either hiring relatively incompetant preparers or they are dealing with the low end of the business where lying clients are a commonplace occurance. You see, around 99% of rejects are created by either incompetance or by a lying client. For the vast majority, neither of those apply to my business. As a result, with around 1000 clients e-filling, we rarely ever get a reject (probably about 1%). If you are not an incompetant preparer and do not hire incompetant preparers and if you do not cater to the low end, you won't have very many rejects either. You are worrying over something that won't even hardly exist for you. Instead, you will find that e-filing is an amazinly simple, easy process that is a major plus for both taxpayer and preparer.

I have been in this business for 35 years. I am NOT in what I would think of as the bank product business although we do have about 4% of our clients who use a RAC to pay their fee. I fought e-filing tooth and nail using all the reasons I see posted here and other places. At the time, I was just as convinced they were valid reasons as I am sure the posters today are convinced they are valid.

About 9 years ago, I bought a business that was already e-filing. At that time, although I hated the idea with every fiber of my being, I felt it would create problems if I went back to paper returns for a clientele who was already accustomed to e-filing. With tremendous reluctance (and a lot of fear and trembling), I began the e-filing process. The first year was a little rocky but not bad at all and from the second year on, I asked myself, "Why did you wait so long?"

It saves me time in up front processing and saves me even more time after the tax season since the number of letters from the IRS radically reduced because my returns were no longer being re-keypunched into the IRS computers by low wage seasonal IRS employees. The time savings from that alone far and away offsets the little bit of time required to handle the occassional reject. It also saves a tremendous amount of paper, toner, envelopes, etc.

The plus for the clients is that they love getting refunds back, WITHOUT having to pay for any bank products, in as little as 8 days. They also love the idea that they do not have to fool with mailing and postage. Sure, once every year or so, you'll get someone who does something stupid like mailing in his copy. Bu stupid things like that happen with paper filing as well.

Over the years, I have gone from being one of those who would post on bullitin boards like this all the negative things I had heard about how horrible e-filing was, to someone who has actually done it and who would hate to ever have to go back to paper filing again.

That's just my 2 cents worth.

Len Boush, EA