The United States Internal Revenue Service (IRS) recently announced a significant shift towards paperless processing of tax returns by 2025, marking a crucial step towards efficiency and environmental sustainability. This initiative, unveiled by Treasury Secretary Janet Yellen on August 2, is set to revolutionize how American taxpayers interact with the IRS, aiming to enhance the filing process’s speed, accessibility, and convenience.
The transition is poised to eliminate an astounding 200 million pieces of paper annually, effectively reducing the environmental footprint of tax filing. It is projected to cut processing times by half, resulting in faster tax refunds—a welcome change for taxpayers nationwide.
Paperless Updates for 2024
For the 2024 filing season, taxpayers can look forward to substantial changes:
- Digital Submissions: Taxpayers will be able to digitally submit all correspondence, non-tax forms, and responses to notices, eliminating the need for physical paperwork and mailing times.
- Extended e-file Capabilities: An additional 20 tax forms will be available for e-filing, expanding the range of taxes that can be filed online.
- Digitalized Non-Tax Forms: At least 20 of the most-used non-tax forms will be available in digital, mobile-friendly formats, making them easier to complete and submit.
Paperless Updates for 2025
By 2025, the IRS aims to implement further enhancements, shifting towards paperless processing for all tax returns. These changes include:
- Increased Availability of Digital Forms: An additional 150 of the most used non-tax forms will be converted into digital, mobile-friendly formats, expanding the scope of services accessible online.
- Digital Processing of Paper-Filed Returns: All paper-filed tax and information returns will be digitally processed, streamlining the workflow and expediting processing times.
- Digital Processing of Paper Submissions: Half of the paper-submitted correspondence, non-tax forms, and notice responses will be processed digitally.
- Document Digitization: Up to 1 billion historical documents will be digitized, helping taxpayers easily access their data and file taxes more seamlessly.
The IRS posits that this paperless initiative will have far-reaching implications, potentially unlocking substantial improvements to taxpayer services. As a financial trust company, we at Legacy Private Trust Company view these changes as an exciting opportunity to streamline our operations further and provide our clients with the most efficient and secure services possible.
We are committed to assisting our clients in navigating these new changes, ensuring they are well-equipped and ready for a smoother and faster tax filing experience. We will continue to provide updates on this significant shift and how it impacts tax planning, filing, and refunds.
Embracing the digital revolution, the IRS’s move to a paperless system is a testament to the ever-evolving technological landscape, reinforcing the importance of adaptability in our day-to-day operations and long-term financial planning. Let’s welcome this new era of tax filing together.
If you are a Legacy client and have questions, please do not hesitate to contact your Legacy advisor. If you are not a Legacy client and are interested in learning more about our approach to personalized wealth management, please contact us at 920.967.5020 or firstname.lastname@example.org.
This newsletter is provided for informational purposes only.
It is not intended as legal, accounting, or financial planning advice.