Originally published March 24, 2003
E-filing eases pain of tax time
With April 15th looming, it's once again timely to consider at least one sure thing in life: Taxes. The inevitability of this event inspires only loathing among the masses and little can make the process more palatable, save for the filing process itself. If your taxes are reasonably straightforward and without need for expert guidance, perhaps you'll find the online filing alternatives sunshine on an otherwise dreary day.
The Internal Revenue Service finally has a functional e-file system up and running on its website with links to e-file partners for individual taxpayers. In prior years, I found the IRS website weak in promoting options for individuals seeking online return alternatives. Now the IRS has links to 80 companies that have partnered with the Internal Revenue Service to provide electronic filing and the choices are plentiful.
There are companies that specialize in first-time filers as well as sites dedicated to the student taxpayer. There is a "young taxpayer" site for people under 25 years of age as well as several online filing options for seniors only. Military active, reserve and retired personnel will find a website specific to their tax filing needs.
Among the e-file partners, you can find full 1040 filing complete with Schedule C itemization or providers that specialize in 1040EZ only. Pricing for filing online returns varies depending on income and services used. Many providers offer free federal filing for incomes less than $30,000 and some also offer oversight and review of your return by accounting professionals for an additional fee.
Who to select among the almost too many choices? The IRS
site has an interactive "Guide Me To A Service" feature whereby a
particular company is recommended based on your answers to a few short
questions. It's some comfort to realize that these companies are approved
Internal Revenue Service "partners", but the IRS makes explicit
disclaimers upfront: "The Internal Revenue Service and the United States
Government do not endorse or warrant these companies or their products or
services." Clearly, it's not the same security that a CPA stamp on the
bottom of your return provides, but since I had two easy returns at my
disposal, I decided to road test them online.
estudenttax.com specialized in tax filing for students and even offered a drawing for a Cancun Spring Break trip, but their $20 filing fee didn't make sense since so many other companies offered free filing for low income filers. Similar sites for first time users also charged a nominal filing fee. I sampled the free TurboTax for the Web 1040EZ and found it was unable to accommodate more than one employee address for multiple W-2s.
H&R Block, a name synonymous with taxes, offered the
best online filing experience among the companies I sampled. The return
qualified for free filing, although for $30 I could use Online Tax Plus that
included professional review by an H&R Block advisor. Navigation was
clear-cut and easy to follow. The return accommodated different addresses for
multiple W-2s and also provided friendly hints along the way for questions that
seemed complex. I was able to "sign" the return by entering the
adjusted income figure from the previous year and the entire process took only
I especially appreciated the H&R e-mail alert system that advised each time the status of the return changed, prompting me to login and review the progress. These notices advised that the return had been filed, accepted and that a refund was on its way.
Cathi Schuler is an Assistant Professor for the School of Engineering and Computer Science at the University of the Pacific. She also owns a business software training company, CeePrompt! firstname.lastname@example.org or email@example.com or by mail c/o The Record, P.O. Box 900, Stockton, CA 95201. She is on the Internet at: http://www.ceeprompt.com. Click here for past archived columns.
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