I’m an Accountant and Here’s Why I’d Never File My Taxes Online
Shutterstock
Believe it or not, we’re close to two months out from Tax Day , so if you haven’t started digging out last year’s filing or organizing your W-2s, you might want to get started. When it does come time to actually submit our returns, most of us opt to do so electronically—whether on our own or through a certified public accountant (CPA)—saving us the hassle of printing everything and mailing it to the Internal Revenue Service (IRS). However, according to Jay Starkman , author and CPA in Atlanta, you might want to revisit snail mail. Read on to find out why he never files his taxes online.
RELATED: IRS Issues New Alert on 5 Things You Must Declare on Your Taxes This Year .
Shutterstock
E-filing is a no-brainer for some, but for others, it’s not a choice. The IRS requires every tax-exempt organization to file certain forms electronically , also requiring businesses with more than 10 returns and preparers who file 11 or more to e-file, Starkman explains in an opinion piece for The Wall Street Journal .
It may sound like e-filing eliminates a lot of unnecessary paperwork, but if you’re lucky enough to have the option, it may be wiser to mail your return. According to Starkman, one of the biggest issues with e-filing is the risk of a cyberattack.
“The problems with e-filing aren’t widely known, even by tax professionals. Paper is more secure, as demonstrated by recent malware attacks on e-filing tax software and preparation companies such as Wolters Kluwer, and by data breaches involving taxpayers’ personal information such as with the company TaxSlayer,” Starkman writes in the op-ed.
RELATED: IRS Warns 20% of Taxpayers Don’t Claim Major Refund Credit—Are You Eligible?
Mehaniq / Shutterstock
Starkman also points to security risks with ID.me. You have to register with the third-party tool if you want to set up an IRS online account or use the IRS Direct File tax program, and ID.me then verifies your identity. To do so, however, you have to submit your Social Security card and other sensitive documents—and that’s where things could get dicey.
“I advise my clients not to use ID.me because it is a private database of personal information,” Starkman explains in the op-ed piece. “My clients have no control over it and must trust that it won’t be hacked.”
RELATED: Ex-IRS Worker Warns TurboTax Is “Trying to Make Your Taxes Harder.”
Leonid Sorokin / Shutterstock
Beyond security threats, filing a paper return gives you a bit more leeway. When you file by the deadline, your return is accepted and considered valid if there’s enough information for the IRS to determine the proper tax, he writes. But those who file electronically don’t have full protection if the IRS flags an issue, according to Starkman.
“Authorizing your preparer to e-file on your behalf doesn’t protect you as a taxpayer, because the IRS doesn’t consider an electronic return until it acknowledges receipt,” he writes.
Starkman cites several examples of taxpayers who thought they had e-filed correctly but ended up being penalized based on mistakes their CPAs made.
SaiArLawKa2 / Shutterstock
In the event you do get slapped with a penalty, you might want to petition the tax court. You can do so by mail or by e-filing, but the latter isn’t ideal in this case either.
Antawn Sanders tried to file a petition online, Starkman explains, but due to technical issues, it was filed 11 seconds past the deadline and rejected as late. Similarly, timezones created an issue when Roy Nutt submitted at 11:05 p.m. Central Time, which was 12:05 a.m. Eastern Time where the courts are, and technically the next day. It was marked as late, but had he put it in the mail and had it postmarked before midnight, it would have been considered on time, Starkman notes.
In general, paper might just be your best option when filing your returns and appeals.
“Considering that e-filing isn’t as forgiving as paper filing and raises other risks, paper returns seem the safest bet,” Starkman says. “Unlike e-filed returns, paper ones won’t get rejected for failure to click on a box. You might even get away with missing a deadline by mailing a day late—though I wouldn’t recommend cutting it close.”
Best Life offers the most up-to-date financial information from top experts and the latest news and research, but our content is not meant to be a substitute for professional guidance. When it comes to the money you’re spending, saving, or investing, always consult your financial advisor directly.
IRS Announces Major Tax Filing Changes for Next Year—How You Can Benefit
brightstars/iStock
Filing your taxes may be the one thing you count on doing every year, but it might not always be the same process. Even when you haven’t had a major life change such as getting married or starting a new job, the Internal Revenue Service (IRS) still makes adjustments to the process that can affect how you submit your paperwork. In fact, those who are already getting everything in order ahead of the deadline might want to take note after the IRS announced a major set of tax filing changes for next year. Read on to see how you can benefit from the latest update.
RELATED: IRS Warns That Claiming These Credits Can Get You Audited and Fined .
iStock
While plenty of people choose to file their taxes online , the process can still involve a decent amount of physical paperwork for some who require extra forms or documentation . But if you’ve had to rely on the postal service to get everything in on time in the past, you can breathe a sigh of relief.
In a Nov. 7 press release, the IRS announced that it had reached its goal of implementing the Paperless Processing Initiative three months ahead of schedule. The program, which was announced in August, makes it possible for taxpayers to submit all correspondence and responses to notices using a Document Upload Tool on the agency’s website.
The new service provides another significant upgrade from the latest changes released last February, which made the nine most common correspondences available for digital reply, Yahoo Finance reports. The prior system relied entirely on using physical mail to conduct business.
Not only will the new system cut processing time in half, but the agency also says the program will help save over 200 million pieces of paper each year. And while the IRS estimates that 94 percent of individual taxpayers will no longer need to use the mail, those who choose to file through the post will still be able to if they choose to do so.
RELATED: IRS Issues New Alert on What You Must Do Before the Year Is Over .
iStock
If there’s any silver lining to paying your taxes, it’s getting a refund down the line. Now, those who are anxious to see some of their cash come back can get a better idea of when it’s coming thanks to the agency’s newly improved Where’s My Refund tool.
According to the IRS announcement, taxpayers will be able to use the online feature to check the precise status of their refund, as well as find out if they need to respond to an agency request for more information. Previously, the tool provided a generic message that didn’t offer any specific information about a person’s filing.
The tool has seen plenty of use in the past, with about 54 million taxpayers using it to generate 550 million hits in 2022, per the IRS. The agency says the detailed updates will likely reduce the number of phone calls made to the IRS for refund status inquiries.
RELATED: 4 Warnings About Using TurboTax, According to Experts .
iStock
When you’re looking for a quick answer to your questions while preparing your taxes, nothing beats the efficiency of a phone call. This year, the agency says it is continuing with improvements it’s made to its phone service to make the service even more accessible.
The agency says it plans to reach at least an 85 percent level of service once again during the 2024 filing season, carrying over improvements made to the system during last year’s filing brought about by hiring a stable of new representatives, per the press release. The IRS will also aim to have an average wait time of five minutes or less and offer a call-back option if the projected wait time is longer than 15 minutes.
RELATED: If You Already Did Your Taxes, You May Need to File an Amended Return, IRS Warns .
Studio Romantic / Shutterstock
Those who want some in-person help will also see some improvements. The agency says it is opening or has reopened 50 Taxpayer Assistance Centers nationwide and will be increasing the number of available hours for assistance by more than 8,500 hours. The complete list of locations and reopening dates can be found in the press release.
The IRS also says it will be rolling out more pop-up centers and aims to increase the number of taxpayers receiving free in-person preparation assistance by 50,000 returns. All told, some experts think the updates could help smooth out what can be a notoriously tricky and confusing process.
“I think these changes are good news,” Grant Dougherty , enrolled agent and founder of Dougherty Tax Solutions, told Yahoo Finance. “Anytime the taxpayer experience can be improved, I think it’s always a win for everyone involved. I do believe the [2024 filing season] will be a little smoother.”
