{"id":26199,"date":"2023-08-02T18:08:22","date_gmt":"2023-08-02T18:08:22","guid":{"rendered":"https:\/\/one.sightlinemg.com\/federaltimes\/uncategorized\/2023\/08\/02\/to-conquer-mountains-of-paperwork-irs-aims-to-go-paperless-by-2025\/"},"modified":"2026-08-08T05:03:20","modified_gmt":"2026-08-08T05:03:20","slug":"to-conquer-mountains-of-paperwork-irs-aims-to-go-paperless-by-2025","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/federaltimes\/management\/2023\/08\/02\/to-conquer-mountains-of-paperwork-irs-aims-to-go-paperless-by-2025\/","title":{"rendered":"To conquer mountains of paperwork, IRS aims to go paperless by 2025"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\">Most taxpayers will be able to digitally submit a slew of tax documents and other communications to the IRS next filing season as the agency aims to go completely paperless by 2025.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The effort to reduce the <a href=\"https:\/\/apnews.com\/article\/irs-tax-return-backlog-answering-calls-7798ae85ac160cbd6939131ef477608d\">exorbitant load of paperwork<\/a> that has plagued the agency \u2014 dubbed the \u201cpaperless processing initiative\u201d \u2014 was announced Wednesday by Treasury Secretary Janet Yellen and IRS Commissioner Daniel Werfel.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The effort is being financed through an <a href=\"https:\/\/apnews.com\/article\/joe-manchin-congress-internal-revenue-service-government-and-politics-dd2e6eaeb914eea553615e231332f3fb\">$80 billion infusion of cash for the IRS over 10 years<\/a> under the Inflation Reduction Act passed into law last August, although some of that money already is being cut back.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThanks to the IRA, we are in the process of transforming the IRS into a digital-first agency,\u201d Yellen said in remarks prepared for delivery during a visit to an IRS paper processing facility in McLean, Virginia.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cBy the next filing season,\u201d she said, \u201ctaxpayers will be able to digitally submit all correspondence, non-tax forms, and notice responses to the IRS.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cOf course, taxpayers will always have the choice to submit documents by paper,\u201d she added.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Under the initiative, most people will be able to submit everything but their tax returns digitally in 2024. And as the IRS pilots its new electronic <a href=\"https:\/\/apnews.com\/article\/tax-irs-taxpayers-direct-file-ef2e9f92ad45984487fd368b851773af\">free file tax return system<\/a> starting in 2024, the agency will be able to process everything, including tax returns, digitally by 2025.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The processing change is expected to cut back on the $40 million per year that the agency spends storing more than 1 billion historical documents. The federal tax administrator receives more than 200 million paper tax returns, forms, and pieces of mail and non-tax forms annually, according to the IRS.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Roughly 213.4 million returns and other forms were filed electronically in fiscal year 2022, which represents 81.2 percent of all filings, <a href=\"https:\/\/www.irs.gov\/statistics\/returns-filed-taxes-collected-and-refunds-issued\">according to IRS data.<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Coupled with decades of underfunding, an overload of paper documents has prevented the agency from processing tax forms at a faster pace in years past, agency leaders have said. The new initiative should allow the agency to expedite refunds by several weeks, according to the IRS.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In June, <a href=\"https:\/\/apnews.com\/article\/politics-internal-revenue-service-business-0d50346f80d92b67cf1fc5ee7b8b0d93\">National Taxpayer Advocate Erin M. Collins<\/a> said the IRS cut its backlog of unprocessed paper tax returns by 80%, from 13.3 million returns at the end of the 2022 filing season to 2.6 million at the end of the 2023 filing season.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The federal tax collector\u2019s funding is still vulnerable to cutbacks. House Republicans built a $1.4 billion reduction to the IRS into the <a href=\"https:\/\/apnews.com\/article\/irs-debt-ceiling-budget-x-date-yellen-fe538fd8371cdf647400a27e6d56a9fb\">debt ceiling and budget cuts package<\/a> passed by Congress this summer.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The White House said the debt deal also has a separate agreement to take $20 billion from the IRS over the next two years and divert that money to other non-defense programs.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The effort is being financed through an $80 billion infusion of cash for the IRS over 10 years under the Inflation Reduction 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