Now that the March 1 deadline has passed for paper forms, any taxpayer planning on avoiding a penalty will be required to file their taxes electronically. As if the longer timeline and higher levels of efficiency weren’t enough, now, revenue officials of Massachusetts and other states are urging you to file your taxes online.
Amy Pitter, the Department of Revenue Commissioner for Massachusetts told the Boston Globe this week that the state is hoping to move to a completely electronic filing system. Currently, 6 percent of Massachusetts residents still file on paper. The agency’s goal is to send no paper forms during next year’s tax season, and those that do want to file on paper will have to request a form…online.
While the agency is reminding everyone how much paper is saved, economically, it’s easy to see why they are set on making you file your taxes online.
“The main reason to encourage electronic filing, of course, is money,” the Globe said. “It costs the state nearly $1 million a year to print, distribute, store, and process paper tax forms, an expense state officials would dearly love to eliminate. The IRS, which stopped automatically mailing out 1040s in 2011, estimates it costs 15 cents to process an electronic return, compared with $3.50 for a paper filing.”
While tax season is nearing an end now, businesses that send out 1099 and W-2 forms can also get on board for next year for these same reasons, to save money and paper. With IRS-approved 1099 processing services, businesses and organizations with contractors or freelancers can use a Web-based tax system to distribute forms. Since 1099 and W-2 rules change every year, these processing services can also ensure that all IRS regulations are followed, helping businesses focus on what’s important.
Tab Service Company is a leading provider of 1099 processing services. As an SOC2-approved service organization, we apply industry-best practices to our approach with clients.