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E-File Or Mail – Shouldn’t The Answer Always Be e-File?



E-File Or Mail - Shouldn't The Answer Always Be e-File?

For over 20 years, both Congress and the IRS have encouraged e-filing of tax returns.  And we know from the pandemic shutdown and work from home that paper filings can easily pile up and are not an efficient way to operate in our digital age.

But why can’t e-filing be more widely available? Some schedules can’t be e-filed meaning the entire return can’t be e-filed. Not all amended returns can be e-filed.

Why not allow all forms to be e-filed?

A case this year also reminded us of a penalty waiver issue when a taxpayer relies on their preparer for e-filing even though IRS instructions list that as a way to e-file. In Oosterwijk, No. CCB-21-1151 (DC MD, 1/27/22), the preparer did not get the extension e-filed (mistakes can happen) and a large payment was involved. The taxpayer tried to get the penalty waived for reasonable cause of relying on their preparer of 24 years. But the court said reasonable cause did not apply to this non-delegable duty (per the Boyle case). When the taxpayer said they had to use their preparer to e-file, the court noted that they could have paper filed!

This is not the first case with this determination. It should be changed to encourage e-filing and prevent courts or anyone from having to say – you’ll need to fill out a piece of paper and timely mail it to the IRS.  That seems very old-fashioned and a poor use of resources by taxpayers and the IRS!

What do you think? Professor Annette Nellen.

Annette Nellen, CPA, Esq., is a professor in and director of San Jose State University’s graduate tax program (MST), teaching courses in tax research, accounting methods, property transactions, state taxation, employment tax, ethics, tax policy, tax reform, and high technology tax issues.

Annette is the immediate past chair of the AICPA Individual Taxation Technical Resource Panel and a current member of the Executive Committee of the Tax Section of the California Bar. Annette is a regular contributor to the AICPA Tax Insider and Corporate Taxation Insider e-newsletters. She is the author of BNA Portfolio #533, Amortization of Intangibles.

Annette has testified before the House Ways & Means Committee, Senate Finance Committee, California Assembly Revenue & Taxation Committee, and tax reform commissions and committees on various aspects of federal and state tax reform.

Prior to joining SJSU, Annette was with Ernst & Young and the IRS.

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One thought on “E-File Or Mail – Shouldn’t The Answer Always Be e-File?

  1. Bob Sedlacek says:

    With a paper return the taxpayer knows exactly what the IRS sees.
    An e-filed return includes more info than a paper return, just start clearing filing rejects and you will see some of the additional info provided the IRS

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