Paying your taxes online is safer and easier than the paper method — plus, the U.S. government offers several ways to file them for free.
Wodicka/ullstein bild via Getty Images
If you’re still stuck in the dark ages of paper tax filing, consider this message your searchlight out from beneath that mountain of forms: It’s time to start paying your taxes online.
In testimony to Congress on January 10, 2024, the Taxpayer Advocate Service, a division of the IRS established to make sure that every taxpayer is treated fairly, stated that as of October 2023, the IRS had a backlog of 1.9 million paper-filed tax returns, causing lengthy refund delays for millions of taxpayers — some lasting 10 months or more.
Although the IRS added that it has since cleared up the backlog, it admitted that its paper processing efforts are an “area of continuing weakness.”
Add to this the fact that IRS staffing levels have reached lows not seen since the 1970s, which have created additional lags in processing returns. In other words, if you don’t pay your taxes online this year, you could be waiting a long, long time for that refund check to arrive.
Why should you pay your taxes online?
Simply put, e-filing, or paying your taxes online, is a better deal for both you and Uncle Sam. Here’s why:
It’s easier — and cheaper — than paper filing. When you file your taxes online, you don’t have to make paper copies, assemble forms and attachments, or shell out money for paper, ink, and postage.E-filing lets you know right away that the IRS received your tax return because it sends you a confirmation.Filing online is safer than paper filing because online encryption technology protects your data from being stolen or compromised.E-filing systems check for errors, which you can correct before you submit your tax return. The IRS says the average online tax filing has a 1% error rate, compared with an average 20% error rate for paper returns.Everyone else is doing it: According to the IRS, 92% of individual tax returns, or 135 million individual income tax returns, were filed online in 2022.Best of all, you get your refund faster — when you file your tax returns online, you receive your tax refund in just 21 days as opposed to waiting 6–8 weeks for a paper return. Plus, you can even opt to have your refund sent as a paper check, if that’s what you prefer. (Other options include direct depositing the refund into your bank account, receiving the refund amount as a debit card or in the form of U.S. Savings Bonds, or having the amount deposited into a Health Savings Account or a retirement account.)
Unless you fall into a rare group of exceptions (e.g., you don’t have a Social Security number or the Internet conflicts with your religious beliefs — both valid reasons), then online filing is the best way to go for most individual taxpayers.
How to pay your taxes online
Options abound when it comes to filing your taxes online, but before you visit a commercial tax provider (many of which lure taxpayers in with free offers only to frustrate them with paywalls when it matters most), you should be aware that the federal government offers several ways to file your taxes for free in 2024.
Free online federal resources
IRS Direct File, a new pilot program, lets taxpayers upload their returns for free — directly to the IRS website. Starting in March 2024, the program will become available to taxpayers in 12 states. IRS Free File is another free service that gives eligible users (who have an adjusted gross income of $79,000 or less) access to free online software programs from partner organizations.The IRS Free Fillable Forms website has a variety of forms and resources you can use and download, regardless of your income level.In addition to online tax assistance, the U.S. government sponsors grants to volunteer-led tax organizations run by nonprofits and universities, to name a few. These orgs offer free online tax filing services to low-income and disabled individuals and people aged 60 and older. The U.S. Department of Defense also has its own online tax service provider for active duty and retired members of the U.S. military, as well as their families.
Other online tax resources
Once you hit “submit,” your tax forms are transmitted electronically to the IRS.
Authorized e-file tax preparers
You don’t even have to do your taxes online yourself; the IRS has created a database of Authorized IRS e-file Providers: Each provider listed has received the IRS seal of approval to prepare, transmit, and process online taxes. The database is searchable by provider type (transmitted, electronic return originator, etc.) and by zip code.
How do I file a tax extension online?
Running late on paying your taxes? You can even request an extension online through the IRS Free File program. It will extend your filing period until October 15, although be aware that you will need to estimate your tax liability and make any payments that are due when submitting your request.