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Electric Slide

Sign up for electronic filing, and you could get a tax-penalty refund.

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This story appears in the November 2004 issue of Entrepreneur. Subscribe »

The doesn't often refund penalties, but if you're ready to take the plunge into electronic tax filing, you could be eligible for an employment tax-penalty refund under a new IRS program. To encourage greater use of the Electronic Federal Tax Payment System (EFTPS), the IRS will provide an automatic one-time penalty refund to some business owners. The IRS estimates that approximately 1 million employers could qualify for the abatement.

The EFTPS enables taxpayers to pay federal employment and income taxes electronically. Taxpayers can use the phone, PC or the internet to initiate tax to the EFTPS directly. The IRS says the electronic payment system is more accurate and less burdensome for taxpayers than mailing payments. Many businesses are required to use the system, but smaller companies still have the option of mailing their payments.

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