How to File Form 720 Electronically

Form 720, the Federal Excise Tax Return, allows businesses to report and pay various excise taxes to the Internal Revenue Service (IRS). These taxes apply to specific goods, services, or activities, such as environmental taxes, communications taxes, fuel taxes, and certain retail taxes. Electronic filing is a preferred method due to its efficiency, accuracy, and convenience, streamlining the submission process.

Preparing for Electronic Filing

Before electronically submitting Form 720, businesses must complete several preparatory steps. The IRS mandates the use of an IRS-authorized e-file provider or tax preparation software that specifically supports Form 720 electronic filing. Taxpayers cannot directly e-file this form through the IRS website; instead, they must utilize a third-party software solution. These providers offer secure platforms to accurately prepare and transmit federal tax returns.

Next, gather all necessary information and documents before inputting data into the software. This includes the business’s Employer Identification Number (EIN), legal name, address, and the specific tax period for which the return is being filed. Precise records of all taxable transactions, such as quantities of fuel sold or amounts of communications services provided, are also required. Organizing these details beforehand ensures accuracy during the form completion process.

Steps for Electronic Submission

After completing preparatory steps and filling out Form 720 in the e-file software, the next stage is electronic submission. Users navigate within their chosen e-file software or online portal to review the completed Form 720 for any potential errors or omissions. This review allows for corrections before transmission to the IRS. After confirming the accuracy of all entered data, the user proceeds to the final submission interface.

Submission involves clicking a “submit” or “transmit” button within the software. The software securely sends the completed Form 720 directly to the IRS. Many e-file providers also facilitate electronic tax payments concurrently with the return’s submission. This involves authorizing a direct debit from a designated bank account, with payment processed on the return’s due date, such as quarterly for Form 720. Upon successful transmission, the software provides an immediate submission ID or confirmation number as proof of submission.

After You File

Following the electronic submission of Form 720, retaining confirmation records is important. Save the transmission confirmation from the e-file provider and any payment confirmation for future reference. The IRS processes electronically filed returns, providing an acceptance or rejection notification within 24 to 48 hours. This notification is accessible through the e-file software or directly from the IRS via the provider. If rejected, the notification specifies the error code or reason, requiring correction within the software and resubmission.