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Of the 95 million tax returns filed electronically with IRS
in 2009, 32 million were prepared and e-filed by taxpayers using computers without
the help of a paid preparer. This was also the fourth tax season in a row that more
"do-it-yourselfers" chose to use web-based (online) programs instead of packaged
desktop software to prepare and file their returns.
Why is web-based filing proving to be more popular than desktop software? Here are
a few reasons:
1)
Desktop software must be purchased in advance, and
once opened, cannot be returned.
Web-based programs can be tried for free – the
user does not have to purchase it until he or she prints or e-files the return.
2) Desktop
software is licensed to be installed and used on one computer, forcing taxpayers
to use the same computer to update their tax return information. Web-based
tax returns
can be updated from any computer at any location.
3) Desktop
software requires the user to download/install the latest updates, patches,
and fixes, exposing them to potential errors if they fail to do so. Web-based programs
are automatically updated.
On the negative side, the chances of having your electronic tax return rejected
by IRS is greater if you file it yourself (compared to having a tax professional
file it). In 2007, 16% of all online returns filed by individual taxpayers were
rejected by IRS, while just 8% of electronic returns filed by professionals were
rejected. Also, thanks to the rapid growth of self-prepared online filing, the number
of unreported income notices IRS mails to taxpayers has more than tripled in
the last five years!
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© 2010 800-TAX REFUND, Inc. |
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