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Is Electronic Filing for You?
From the editors at WIFE |
Wanted: Compatible computers for online
communication.
Objective: electronic transfer of tax data and refunds.
That’s the lonely hearts message being sent by the IRS, which wants your computer to
cuddle up to its computer for electronic filing. The IRS is gung-ho about encouraging
taxpayers to file electronically, but some taxpayers aren’t sure, and so far only a
small percentage of tax returns have been filed electronically.
Last year the IRS received over 29 million income tax returns that were filed
electronically by taxpayers around the country. This year, the number is likely to be
astronomically bigger, as consumers discover that the computer can help them prepare taxes
as well as acquire holiday gifts.
Is electronic filing for you? Here are some of the reasons you might want to file
electronically.
1) It’s cheaper for the IRS.
It saves the IRS money if you file electronically, but why should that matter to you?
After all, it’s not as though they are going to rebate part of your taxes to reflect
that savings.
2) Your refund comes faster.
If you are due a refund, you can get that money lickety-split. The IRS will notify you
it’s received your return within two days after you file, and it will send your
refund to your bank within the next couple of weeks. Compare that to the two months it
might take to get your refund the old-fashioned way, and you’ll begin to see the
advantage.
3) You can do your taxes without tears.
Another advantage is that you can prepare your return easily by using one of the
tax-software programs that are available. You’ll be able to prepare your tax return
and submit it without ever touching pencil to paper. But you’ll still have to do one
small piece of paperwork. You’ll have to submit Form 8453-OL to the IRS with your
manual signature.
4) Your return will be more accurate.
More that one-fifth of all returns that are prepared manually have math errors on them.
The math errors that crop up when you do your own figuring will be non-existent with
electronic processing.
5) No more stumbling through IRS forms.
The tax preparation software lets you enter data in a logical, question and answer format.
You fill in the blanks in each category, and the software puts it on the right forms in
the right places. (If you have the heart and sour of an accountant, most programs will
allow you to type directly onto the forms.) Of course, it’s still up to you to gather
together the figures for your donations, interest and the like.
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