The IRS has announced the opening of an expanded IRS e-file program for 2008 federal tax returns.
IRS Commissioner Doug Shulman is encouraging taxpayers to take advantage of the e-file program, noting that, “Filing electronically with direct deposit can get refunds to taxpayers in as few as 10 days.” That’s right: 10 days. Don’t be fooled by tax loan schemes who claim that it will take months for you to get a refund.
In contrast, if you owe money to the feds, you can e-file early and wait to pay the tax due by the deadline. Why pay Uncle Sam early if you don’t have to?
How popular is the e-file program these days? In 2008, nearly 90 million tax returns were filed electronically, representing 58% of return filed. That’s a pretty significant increase from 1986, the year the plan was introduced, when only about 25,000 returns were e-filed.
Most taxpayers who e-file still rely on a tax professional to prepare their returns. In 2008, only a third of e-filed returns were filed from home computers.
It’s important to understand that the IRS does not charge a fee to e-file your tax return. However, tax professionals and tax software may charge a processing or service fee.
Are you planning to e-file this year? If you’re planning to file from home, don’t forget to click over to this previous post for a chance to win free tax software from TurboTax and taxgirl!
Hi Kelly,
I can’t speak for all “tax loan schemes” but I worked for Jackson Hewitt. We would tell our customers that they could get their money from the IRS in as little as 10 days. What our customers liked was that they could get a check that they could cash in Wal-Mart. Many of these customers were filing for EIC which was “found money” and would pay any amount to get it. They also didn’t have to open a checking account (a requirement to get their money automatically deposited).
Thanks for that, Bo. I don’t believe that all tax loans are schemes – but we all know that they are around. When I used to manage our local VITA tax site at the senior center, I was horrified to hear how many of our low income clients were shelling out more than 100% interest because they were told directly by the loanshuckers (yes, I made that up) that if they did not e-file with the service, their refunds would be delayed up to two months. There were too many reports to be a coincidence or a misunderstanding. A federal judge noted similar stories .
There are many “Free File” options now online, where the federal return can be prepared and E-filed if one meets certain guidelines. These can be found on the IRS website. The catch is of course there is a charge for the state return.
Rick, you’re about two steps ahead of me! That’s tomorrow’s post (shh!).
If the government wants me to e-file, then it needs to cost less than 42 cents. Otherwise they will be processing my paper form. I’d rather spend an extra few hours working on my forms than supporting the “tax software” industry. It is a drain on our economy and easily remedied by a simplified tax code.
Oops… Sorry. Maybe a discussion about whether the IRS should cooperate with the refund loans, frankly if they did not cooperate, the firms would not be as likely to offer these 2 week loans.
Try as I may, I find it hard to talk clients out of using them, and I do try. We seem to have a lot of poor money managers in our country.
Also, if you’re close to an IRS office, and under certain income limits ($35,000?), you can go to the physical IRS location, and they’ll help you prepare your return. Ditto for the PA Dept of Revenue. Don’t know about other states….
Casey,
I’ll bet Kelly is going to tell you how to efile your fed return without buying software. At least if I read the IRS website correctly.
I’ve emailed my Congressman,and Senators the last 3 years about e filing. If your below a certain income level you can e-file for free on several of the IRS sponsored sites. But….all these returns go through 3rd party web sites to get to the IRS. So you are exposing all of your most vital personal information to more unknown web servers,and unknown people. Even if you pay to file through Turbo Tax you still send your information to thier servers,and what ever,where ever to get to the IRS.
Our government needs to have its own secure way for us to send in our forms directly to the IRS without incurring more expense to file our taxs.
My Congressional and Senatorial replies is always the same. They are working on it!