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e-file Benefits for Tax Professionals

Create loyal, satisfied clients with e-file.

October 26, 2009
Sponsored by IRS

e-file continues to grow in popularity each year with more than 90 million tax returns submitted electronically in 2009, a 20 percent increase over 2008. Sixty million of the tax returns were filed by tax professionals in 2009.

Benefits of e-file

Research shows that preparers who use IRS e-file are highly satisfied.

  • Proof of Receipt: When tax professionals use e-file, clients receive proof within 24 hours that the tax return has been accepted by the IRS.
  • Accuracy: Because e-filed returns are in the system exactly how you prepared them, your clients are reassured that their taxes are done error-free without having data re-input by the IRS.
  • Up-front Validity Checks: With many e-file programs, mistakes are caught that otherwise wouldn’t be detected until weeks, months or even years later.
  • Quicker Refunds: Clients will receive their refunds in as little as 10 days as long as they use Direct Deposit.
  • File Now. Pay Later: If your clients owe on their return, they can file now and defer payment until April 15th with several payment options.

e-file Is Easier Than Ever

The IRS is making it easier for you to take care of your clients’ taxes electronically as e-file expands and improves each year.

Electronic Signature

All e-filed individual returns submitted by tax professionals must now be electronically signed using a Personal Identification Number (PIN). Tax professionals can choose from a Self-Select PIN or Practitioner PIN.

The Self-Select PIN allows taxpayers to electronically sign their e-filed return by using a five-digit PIN. Their prior year Adjusted Gross Income (AGI) or prior year PIN are used to verify their identity. When taxpayers enter their PINs directly into the electronic return, signature authorizations are not required. In all other instances, taxpayers must sign the Form 8879, IRS e-fileSignature Authorization.

A Practitioner PIN is used when a taxpayer authorizes an Electronic Return Originator (ERO) to input an electronic signature on behalf of the taxpayer. A Practitioner PIN authorizes the ERO to generate or enter the taxpayer’s PIN on an electronically filed return. This method requires the tax practitioner to use Form 8879, IRS e-fileSignature Authorization. The form is retained by the ERO.

It is important for tax professionals to remember to make sure their EFIN is valid, approved and active when signing an individual taxpayer’s returns.

Exception Processing

Each year, more than 10 percent of individual returns electronically filed to the IRS are rejected by IRS systems for a host of reasons, the most common is inconsistent Social Security Numbers. Exception processing allows tax professionals to send an imperfect return electronically for reject codes 501 and 504 only.

Join the growing number of tax professionals who have used e-file and say that it is well worth it. E-file and e-pay can create loyal, satisfied customers.