The Internal Revenue Service (IRS) announced that starting in 2024, taxpayers will have the choice to have completely paperless transactions when filing their taxes. The IRS intends to achieve paperless transactions in processing all tax returns by 2025 through the IRS Paperless Processing Initiative project.
Treasury Secretary Janet Yellen and IRS Commissioner Daniel Werfel shaking hands.| Yahoo News-UK
The IRS wants to phase out most IRL tax documents by 2025 which gives taxpayers an option to have a paperless transactions in the coming 2024 filing season.
This paperless transactions effort aims to eliminate around 200 million pieces of paper per year, reduce processing times by 50%, and expedite refunds by a few weeks. This paperless transactions project is funded by President Biden’s Inflation Reduction Act of 2022.
The IRS is making changes to eliminate the inconvenience of sending paper documents in certain situations while still employing paperless transactions in others. This will help taxpayers who previously had to mail in documents and IRS employees who had to manually input data from paper returns which causes delays and difficulties.
The paperless transactions are applicable to any correspondence to the IRS including matters that are not directly related to taxes. The IRS will make at least 20 additional e-File tax forms available digitally, with the goal of ensuring that over 94% of individual filers will have the option of paperless transactions.
This initiative will eliminate the need for approximately 125 million paper documents to be sent by taxpayers each year. By 2025, the IRS plans to make an additional 150 commonly used non-tax forms available in digital, mobile-friendly formats, taking into account that 15% of Americans rely solely on their phones for internet access.
The IRS intends to digitize up to one billion historical documents, making it easier paperless transactions for customer service agents and taxpayers to access older filing data.
The IRS also aims to process all paper-filed tax and information returns digitally as soon as they are received, which amounts to an estimated 76 million paper documents per year. Additionally, about half of the paper-submitted correspondence, non-tax forms, and notice responses, totaling around 60 million paper documents, will be recorded digitally.
In an AP News article, with the introduction of a new electronic free file tax return system in 2024, the IRS aims to process everything, including tax returns, digitally by 2025.
The said paperless transactions initiative was announced by Treasury Secretary Janet Yellen and IRS Commissioner Daniel Werfel. During a visit to an IRS paper processing facility in McLean, Virginia, Janet Yellen mentioned that the IRA has been instrumental in helping the IRS transition to digital-first agency with its new system of paperless transactions.
READ MORE| The IRS wants to phase out most IRL tax documents by 2025
