Telefile

Telefile is a now-defunct tax service formerly offered by the U.S. federal government. The IRS provided telefile service nationally from 1997-2005. Telefile allowed taxpayers filing the IRS form 1040EZ to phone in their tax returns with a touch-tone phone.

Telefile is no longer in place and individuals can no longer phone in their IRS tax form. In the 8 years the IRS allowed telefiling, it was marketed as a convenient service for taxpayers with simple tax returns. The Telefile service worked by letting taxpayers dial the numbers on their tax return directly into the phone to report their income.

Telefile was not a service that could be ordered; eligible taxpayers automatically received the Telefile package in the mail. The IRS only made telefile available to individuals who filed form 1040EZ. The 1040EZ is the shortened version of the IRS’s standard Form 1040, which is the standard form for income tax. Intended for taxpayers with basic tax situations, this condensed version offered a fast and easy way to file income taxes. To use the form, a taxpayer must have had taxable income of less than $100,000, less than $1,500 of interest income, and have claimed no dependents. For most individuals, the 1040EZ is the first tax form they will ever complete.

The IRS replaced telefile with electronic filing in 2005. E-filing allows individuals to submit their tax returns over the internet using IRS pre-approved tax preparation software. Over the last several years, e-filing has increased in popularity and is now the most common way individuals file taxes. Beyond the convenience of filing their taxes in the comfort of one’s own home, e-filing saves the tax agency time and money by transmitting tax data directly into the agency's computers, significantly reducing the possibility of keying and input errors. Another benefit is that when e-filing, the tax filer receives a confirmation or rejection notice within 24 hours of transmitting the electronic documents. That confirmation is proof that the IRS received the tax return and it is in process, while the rejection is notice to the taxpayer that his or her return has not been accepted by the IRS.

If an individual’s adjusted gross income is $66,000 or under, taxpayers can file on the IRS website directly, using IRS Free File. While there are many companies that provide e-filing to individuals and businesses, the IRS does not endorse or approve any particular software for e-filing.