How to E-File Your Business Tax Return

Streamlining your business processes should always be on your radar. One of the easier ways to do that is to file your business tax returns electronically. Also known as e-filing, completing your tax returns electronically can expedite the filing process, reduce errors, and eliminate your need to track down paper documents in years to come.

E-filing options & requirements for businesses

Today, e-filing is an option for most businesses, but it is a requirement for some. The process provides efficiencies and increased accuracy for both the taxpayer and the IRS, so the IRS will likely continue to expand the list of taxpayers required to file their returns electronically.

Currently, corporations with assets of over $10 million that file at least 10 returns annually (including information returns such as W-2s for employees and 1099-NECs for independent contractors) must file their returns electronically.

If you haven't previously filed your tax returns via e-file, this tax year is a great time to get started.

Getting free help to e-file federal tax returns

If you have specific questions regarding filing taxes, making payments, or which forms are needed for your situation, the IRS has extensive resources available on its website at IRS.gov.

Individuals and sole proprietors with income below a certain level can use free filing services provided by private companies in partnership with the IRS. The software may be more restricted than their commercial products, but many common forms are available, including the Schedule C.

The IRS's Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) programs offer free one-on-one tax preparation services to people who meet certain income or other qualifications. TCE preparers receive special training in answering questions about pensions and retirement-related issues, which may be helpful if you started your business after an earlier career. Both programs can e-file your business tax return on your behalf.

If you file your return using commercial software

When you use off-the-shelf software (or an online version of it) to complete your tax returns, you will first sign in to e-file your return and self-select a five-digit personal identification number (PIN). You will also need to authenticate your identity using your date of birth and your prior year's adjusted gross income (AGI).

Commercial software allows you to schedule your payment for any date up until your tax payment due date. Alternatively, you can make payments online, by phone, or by sending a check or money order through the mail.

If you would like to file your quarterly employment taxes online, you will need to purchase IRS-approved software and pay a fee to file your returns electronically. You may prefer to work with a tax professional or service who will complete and e-file these returns for you.

If you work with a tax preparer

For more complicated tax situations or to ease your mind, you may choose to work with either a volunteer or paid tax preparer. Tax professionals are usually authorized IRS e-file providers and fully understand tax preparation and the e-filing process.

Professional tax preparers can e-file your returns, process your payment, and have access to retrieve tax filing transcripts from prior years. Another benefit of working with a tax professional is their access to the IRS Practitioner Priority Hotline, which is often more efficient for resolving tax issues than contacting the IRS through other means.

State tax return filing

Your business tax responsibilities may extend to include filing state income tax returns and sales tax returns. For information on e-filing your state tax returns, check with your state's Department of Revenue, which you can find at TaxAdmin.org.

Streamline with electronic tax return filing

The IRS's business e-file process is efficient and secure, and you can integrate it into your existing tax preparation routine. Whether you complete your own tax returns or get assistance from a tax professional, you can utilize this filing service. And if you are owed a refund, filing electronically can get your money back to you quickly as well.