Electronic tax return filing: should it be mandatory?

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Spacers's picture
Joined: 12/29/03
Posts: 4100
Electronic tax return filing: should it be mandatory?

Electronic tax return filing has been shown to be more secure, more accurate, and faster & cheaper to process than paper filing. Every professional tax preparation company in the U.S. is required to file tax returns electronically, but people who do their own taxes are still allowed to send in paper. And there's no charge for sending in a paper tax return even though it costs more for the IRS to process them.

Should everyone who has internet access be required to file their tax returns electronically? Should people who file paper returns be charged a fee to cover the additional cost?

Joined: 03/08/03
Posts: 3185

No way. Asking people to send personal financial information over the internet, and charging them for doing otherwise, is not fair. I know quite a few people who don't do any of their financial transactions on the web, who don't use credit cards, etc. And you can't charge people for how they pay their taxes! It's already preposterous that it's so complicated that it requires paid assistance to do; the only years I was able to do my own was when I was single, had one consistent job, and owned nothing. Now it's impossible.

If you're doing your taxes on your own you should not have to pay extra to submit them.

AlyssaEimers's picture
Joined: 08/22/06
Posts: 6560

You absolutely should have the option to send your taxes in by mail. I will use the example of my parents. My dad would not know how to turn on a computer to save his life. She should not be charged extra to file his taxes.

Joined: 04/12/03
Posts: 1686

"Spacers" wrote:

Electronic tax return filing has been shown to be more secure, more accurate, and faster & cheaper to process than paper filing. Every professional tax preparation company in the U.S. is required to file tax returns electronically, but people who do their own taxes are still allowed to send in paper. And there's no charge for sending in a paper tax return even though it costs more for the IRS to process them.

Should everyone who has internet access be required to file their tax returns electronically? Should people who file paper returns be charged a fee to cover the additional cost?

"freddieflounder101" wrote:

No way. Asking people to send personal financial information over the internet, and charging them for doing otherwise, is not fair. I know quite a few people who don't do any of their financial transactions on the web, who don't use credit cards, etc. And you can't charge people for how they pay their taxes! It's already preposterous that it's so complicated that it requires paid assistance to do; the only years I was able to do my own was when I was single, had one consistent job, and owned nothing. Now it's impossible.

If you're doing your taxes on your own you should not have to pay extra to submit them.

If the reason they aren't using the Internet for financial business is security, filing electronically is more secure. (OT: look at the Target breach - the online purchases weren't effected; just those made at the store.)

I do my taxes every year using turbotax. It's $20 to file my state taxes electronically. Federal was free.

I don't see a problem with requiring taxes submitted online. 20 years ago direct deposit was an option at some places and over time it has become the norm, even mandatory for some sources of income.

If you want to get technical, you do have to pay for the postage to submit a paper return.

Joined: 04/12/03
Posts: 1686

"AlyssaEimers" wrote:

You absolutely should have the option to send your taxes in by mail. I will use the example of my parents. My dad would not know how to turn on a computer to save his life. She should not be charged extra to file his taxes.

How do they do their taxes?

Joined: 03/08/03
Posts: 3185

"ethanwinfield" wrote:

If the reason they aren't using the Internet for financial business is security, filing electronically is more secure. (OT: look at the Target breach - the online purchases weren't effected; just those made at the store.)

I do my taxes every year using turbotax. It's $20 to file my state taxes electronically. Federal was free.

I don't see a problem with requiring taxes submitted online. 20 years ago direct deposit was an option at some places and over time it has become the norm, even mandatory for some sources of income.

If you want to get technical, you do have to pay for the postage to submit a paper return.

I'm not saying it isn't safe. I'm saying that my in-laws, for example, won't believe that it is no matter what I tell them. They should not be charged extra for doing it the same way they've always done, which they are comfortable with.

mom2robbie's picture
Joined: 01/20/07
Posts: 2541

I know here they encourage e-filing but it is not mandatory. Starting in 2015 there will be no more government cheques, everything has to be done by direct deposit.

Question? I know that Americans file separate tax forms for state and federal, do they go to separate places? Here the federal government collects on behalf of the provinces and forward the money on.

mom3girls's picture
Joined: 01/09/07
Posts: 1535

Nope. People should be able to file however they want, just as long as they file.

Joined: 04/12/03
Posts: 1686

"freddieflounder101" wrote:

I'm not saying it isn't safe. I'm saying that my in-laws, for example, won't believe that it is no matter what I tell them. They should not be charged extra for doing it the same way they've always done, which they are comfortable with.

So then the rest of the taxpayers should pay it instead? Employees processing the returns are paid for through tax dollars. Just for argument's sake, if it cost $1 to process an electronic return and $10 to process a paper return, why should it be the rest of the taxpayers who pay that? Why shouldn't the actual cost be passed on to the person who incurred the cost?

I started using tax software in about 1996. I don't know when I started filing electronically, but I know I have had direct deposit of my refund for the past 15 years.

Times and technology have changed. I *know* how to do my taxes using the publications and the forms, but why? It is so much easier to use the tax software and choose the bubble for "file electronically" than print forms and mail.

Joined: 04/12/03
Posts: 1686

"mom2robbie" wrote:

I know here they encourage e-filing but it is not mandatory. Starting in 2015 there will be no more government cheques, everything has to be done by direct deposit.

Question? I know that Americans file separate tax forms for state and federal, do they go to separate places? Here the federal government collects on behalf of the provinces and forward the money on.

Off the top of my head, I mail my federal to Fresno, CA and state to Sacrament, CA. So, yes, we mail them to separate places. Not all states collect state income taxes.

Joined: 08/17/04
Posts: 2226

Nope, I'm filing for taxes...taxes that I get back because they take too much during the year. They'll get it how they get it.

Side note, we use a preparer so mine are efiled anyway. Even when I did them myself, I tele filed (before e filing was big!)

Joined: 04/12/03
Posts: 1686

Wouldn't you all agree though that at some point, the cost becomes too great? It's just a matter of where that threshold is.

For example, if it took you 8 hours and 3 trips to the PO/library/Staples to pull all the tax forms, plus $4 or $5 to make copies and mail your taxes, you would have to assess how much that time is worth to you.

On the other end, we should be looking at that cost collectively. Computer programs can flag errors on both ends. It will take a lot less time to catch mistakes electronically than by someone combing through the numbers. If we are paying an employee 8 hours to process a complicated return, is that money well spent?

Just because something has always been a certain way doesn't mean there isn't a better way.

Joined: 08/17/04
Posts: 2226

I absolutely think e filing is something to be encouraged. I know I am motivated because return comes faster.

Spacers's picture
Joined: 12/29/03
Posts: 4100

"AlyssaEimers" wrote:

You absolutely should have the option to send your taxes in by mail. I will use the example of my parents. My dad would not know how to turn on a computer to save his life. She should not be charged extra to file his taxes.

Then he would probably be exempt because he probably doesn't have internet access. Blum 3

Last year I was doing our taxes on TaxSlayer. I had our various tax forms but no royalty report from one of DH's publishers. I asked DH if he made any royalties from that company that year, and he checked his bank account and said no. Our return was bumped back from the IRS within 24 hours because he *had* earned royalties and they had been reported to the IRS already even though we hadn't received our copy of the form, and he had never cashed the check. Twenty years ago, someone at the IRS would have manually entered everything from our paper filing, someone else would have proofed it, someone else would have verified our numbers against what our employers reported, since they didn't match someone else would check it again, and then it would be sent back to me. That whole process would probably take 2-3 months and I would incur penalties and late fees, and it would take another 2-3 months to get my refund after making that one simple correction. Instead, the mistake was found immediately, I was able to correct the mistake and re-file, and we had our refund in our bank account before we even got that form from that one publisher. I don't understand why anyone with internet access does NOT file online. I mean, the number of people your paper return goes through, who could pop that envelope into their pocket & instantly they have your name, address, age, social security number, marital status, kids' names & SSNs, bank account information, and signature -- that's far scarier to me than filing online! :shock:

Joined: 03/08/03
Posts: 3185

"ethanwinfield" wrote:

So then the rest of the taxpayers should pay it instead? Employees processing the returns are paid for through tax dollars. Just for argument's sake, if it cost $1 to process an electronic return and $10 to process a paper return, why should it be the rest of the taxpayers who pay that? Why shouldn't the actual cost be passed on to the person who incurred the cost?

I started using tax software in about 1996. I don't know when I started filing electronically, but I know I have had direct deposit of my refund for the past 15 years.

Times and technology have changed. I *know* how to do my taxes using the publications and the forms, but why? It is so much easier to use the tax software and choose the bubble for "file electronically" than print forms and mail.

Well it's a lot cheaper than it used to be as more and more people file electronically, so those costs will continue to go down until they disappear entirely. So yes...however it gets covered now is how it should continue to get covered. The number will decrease yearly. I don't think it's fair to call it "incurring the cost" when the government requires you to file your taxes. I can't imagine my in-laws having to file online. They simply don't use computers for anything financial, they don't even use credit cards. I don't see the need for them to have to pay more to do what they've always done, to pay taxes required by the government. It's unfair.

I e-file through our tax guy.

Joined: 03/08/03
Posts: 3185

Also adding, I know that it makes more sense to e-file. I just know a handful of people -- which tells me there are more handfuls out there, as I'm an NYC-er -- who don't do any of those things online: no banking, no shopping, nothing. They don't use credit cards, they just keep one for emergencies. They are not comfortable with this. I can't imagine them being willing to even type a social security number into a website, no way.

These numbers are absolutely dwindling, and eventually there will be hardly any left. Charging them more to file the way they've filed for decades makes no sense, especially when there are so many other places to cut money in these bloated budgets & bureaucracies.

KimPossible's picture
Joined: 05/24/06
Posts: 3311

I would actually be fine with mandating it at some point. Maybe now is not the time yet...but in the future.

As for being charged for insisting on using antiquated and poorer methods for doing things that could be done more efficiently and more safely?

I'm okay with that! "I like doing it the old way" isn't a good enough reason IMO to not make new rules. Actually, i think its a terrible reason.

Joined: 03/08/03
Posts: 3185

"KimPossible" wrote:

I would actually be fine with mandating it at some point. Maybe now is not the time yet...but in the future.

As for being charged for insisting on using antiquated and poorer methods for doing things that could be done more efficiently and more safely?

I'm okay with that! "I like doing it the old way" isn't a good enough reason IMO to not make new rules. Actually, i think its a terrible reason.

It would have to be phased out over time. I think it'll happen naturally anyway.

KimPossible's picture
Joined: 05/24/06
Posts: 3311

"freddieflounder101" wrote:

It would have to be phased out over time. I think it'll happen naturally anyway.

Yeah, i mean i really think if they did an analysis, i think mandating it now would cause more problems then help, because there are still too many people that don't feel like using the internet/computers is second nature.

Maybe it will happen naturally.....i think some people hold on to old ways of doing things as long as they can. I could see a point in time where mandating it could go smoothly and make sense, to just make those last resistors, who are fully capable of changing, actually change.

MissyJ's picture
Joined: 01/31/02
Posts: 3212

"Spacers" wrote:

Should everyone who has internet access be required to file their tax returns electronically? Should people who file paper returns be charged a fee to cover the additional cost?

What would qualify as 'internet access'? For example, my parents use the library weekly (for books) but would that be considered having internet access since that is definitely NOT a place to do taxes online.

My MIL (86) has internet access at home -- but opening an emailed pic of the kids is a challenge. Blum 3 No way would I want her doing her taxes online.

I think as others have mentioned that it is moving on its own to more and more e-filing. I would hate to punish those that remain with paper filing further as the majority of those impacted would likely be the elderly and poor.