The IRS has announced that people will now be able to file every major tax form online, which is a big move to improve customer service and streamline tax processing.
This decision unveiled on a Wednesday, is part of the agency’s efforts to digitize its massive paper catalog by 2025. The improvements are made possible by the influx of funding from President Biden’s landmark Inflation Reduction Act.
With these advancements, taxpayers will have the option to complete complex tax paperwork online or directly upload related documents to their IRS accounts, eliminating the need for traditional mailing of hard copies.
This change not only reduces the hassle for taxpayers but also expedites the processing time for the IRS, leading to quicker and more accurate refunds. The agency has long encouraged electronic filing to avoid the laborious task of manually inputting data into its outdated computer system.
By the 2025 tax season, the IRS plans to digitize paperwork submitted through mail or fax using optical scanners, which will automatically upload taxpayer data to their respective accounts.
This Paperless Processing initiative is a crucial step towards further improving customer service, as Treasury Secretary Janet L. Yellen is expected to emphasize in a forthcoming speech.
IRS Upgrades Projected to Save Millions Annually
The IRS Commissioner, Daniel Werfel, has prioritized customer service improvements since assuming office in March. Nearly $1 billion in new funding has already been allocated to hire additional customer support staff, leading to a remarkable improvement in customer service during the 2023 tax season.
Furthermore, the IRS is set to introduce a pilot program in 2024, allowing taxpayers to file digital returns for free. This initiative aims to encourage taxpayers to embrace digital filing platforms instead of relying on tax-prep companies that may charge fees or collect personal data.
The upgrades announced on Wednesday are also expected to result in substantial cost savings for the IRS, with the reduction in paper usage projected to save tens of millions of dollars annually. Currently, the agency spends around $40 million each year to store billions of taxpayer documents.
The Inflation Reduction Act passed in 2022, authorized an additional $80 billion over a decade to support the IRS’s initiatives, including improving tax enforcement for high-income earners and major corporations, customer service, and technology systems.
Though a portion of this funding was reallocated to address a government default, the IRS still received its most substantial funding influx in generations, providing a much-needed boost after years of budget cuts and staffing shortages.
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Source: The Washington Post via MSN
