Electronic filing hits 73 percent, IRS says

WASHINGTON — About 73 percent, or 39.5 million individual tax returns, out of the 54 million submitted so far this year have been filed electronically, the Internal Revenue Service reported Tuesday.

“The home computer is increasingly replacing the paper tax form,” IRS Commissioner Mark Everson said in a press release. “Both individual taxpayers and tax professionals are turning to e-file more and more because it’s fast and accurate.”

Some taxpayers with simple returns can prepare electronic returns for free using the IRS Web site ( www.irs.gov). Those who buy software such as TurboTax and TaxCut have the added convenience this year of lower retail prices because the vendors have abandoned the use of mail-in rebates.

The percentage of electronic filers is only up slightly from the 72 percent who e-filed at the same time last year, but the IRS says other indicators show taxpayers are relying more on home computers for tax preparation:

— Visits to the IRS Web site have increased 6 percent since last year, with 70.4 million hits since January.

— About 76 percent of refunds have been made electronically, up from 73 percent a year ago.

“It just indicates how much (easier) the Internet makes what otherwise is an unpleasant process,” said Joseph Bankman, a law professor at Stanford University who has been involved with California’s experiment with the next generation of electronic tax returns.

California’s experiment, called Ready Return, sends an estimated income tax bill to citizens with simple tax returns who agree to participate.

For taxpayers who prefer to prepare their own tax returns, one bill pending in the California Legislature would allow taxpayers to gain electronic access to Form 1099 information regarding mortgage interest and other financial information.

Bankman said electronic access to Form 1099s would alleviate taxpayers of the burden of keeping track of paper and improve the accuracy of tax returns.

“It would be great to have you or your accountant or your computer download that information and check your numbers,” he said.

Bankman testified last year about electronic filing to the President’s Advisory Panel on Federal Tax Reform. The commission filed its recommendations for tax simplification late last year, but the Treasury Department has not sent the White House its response to that report.