Why am I getting an error that shows:
"NOT ELIGIBLE FOR ELECTRONIC FILING"
Your client's federal return is not eligible for electronic filing due to the following reason:
The tax withheld of $x,xxx as shown on Form 1040 is greater than or equal to $0, the sum of income from following sources:
Followed by a list of sources.
The list of sources includes the W-2's that have the tax withholding on them.
"These rules are set by the Internal Revenue Service Electronic Tax Administration."
Note that this return includes an NOL carryforward.
Is there a way to change the return that would still make it eligible for electronic filing?
Your government has chosen not to buy computers that could perform the simple task these days of matching W-2 and 1099 withholding to an SSN-based file of individual taxpayers. Fraudsters have known for decades that they can make up their own W-2 with lots of withholding and get it past IRS. There are those who think investment in technology would be a better choice than some of the other things we spend money on.