Telephone Filing in 7 States

WASHINGTON - Taxpayers in seven states next year will be able to file their federal tax returns by telephone. The Internal Revenue Service will expand TeleFile -- its file-by-phone system -- to Florida, Indiana, Kentucky, Michigan, South Carolina, and West Virginia.

This easier filing option will continue to be available to taxpayers in Ohio where the IRS tested the system for two years. In the first year, Ohioans filed 126,000 returns by phone, with the number growing to 149,000 this year.

Taxpayers can reach TeleFile seven days a week, 24 hours a day, by dialing a toll-free number. Callers just enter the amounts for their wages, interest and tax withheld. TeleFile does the rest of the work for them in just seconds. If totals the income, subtracts the exemption and standard deduction amounts, gets the tax from the tax table and figures any refund or balance due.

The system gives the caller the adjusted gross income and refund or balance due amounts, as well as a confirmation number to complete the filing. The whole call takes about five minutes.

The IRS processes the data through its electronic filing system, giving users such benefits as faster refunds and more accurate tax returns. TeleFilers should get their refunds in three weeks, quicker than the usual four to six weeks for regular returns. Unlike electronic filing, TeleFile does not offer direct deposit for refunds. Persons who owe tax can send the payment immediately or anytime before the April 15 deadline.

An IRS survey last year found that very few TeleFilers would have used a paid preparer or filed electronically. Through TeleFile, the IRS is opening alternative filing options to taxpayers who would otherwise remain bound to the traditional paper tax forms.

TeleFile is available to single persons who would otherwise file Form 1040EZ and have not changed their addresses since their last filing. The IRS will send 4.7 million special tax packages to prospective filers and expects to get 550,000 TeleFile returns. Only persons receiving such packages can use TeleFile.

The IRS plans to continue its TeleFile test of the paperless "voice signature" method in southern Ohio next year. Elsewhere, TeleFilers will send signature documents -- Forms 1040-TEL -- and their W-2 forms to the IRS after they complete their calls.

TeleFile's future expansion depends on its integration with the ongoing IRS implementation of Tax Systems Modernization.

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