ANNAPOLIS – The filing deadline for income tax returns is looming, and more people are relying on their computers to reduce the time and effort it takes to file their tax forms.
The Maryland comptroller is encouraging people to file electronically when they can because it’s more efficient and shortens the time for taxpayers to receive their refunds, said Michael Golden, spokesman for Comptroller William Donald Schaefer.
This year, the filing deadline falls on April 16 because the traditional deadline, April 15, is a Sunday.
The electronic option has grown in popularity since it began several years ago. So far this year, the office has counted 443,805 electronic filings, a 28 percent increase over last year’s 346,188. And that was 41 percent more than it was in 1999.
“People are finding it’s a quick, safe, easy way of doing their taxes,” Golden said. “We’re getting a lot of return filers. Once you do it, you get hooked.”
Last year, Marylanders had to buy commercial tax software – like TurboTax or Quicken – to file their state income taxes online. Tax preparation software from companies like Kiplinger or Intuit, which sells TurboTax State, usually costs about $30.
This year, they can file the short forms directly through the Internet for free and forego purchasing software. The forms are available on the comptroller’s Web site, www.comp.state.md.us.
“That has the potential of affecting about 450,000 Marylanders,” Golden said.
“That’s about how many usually file the short form.”
This year, about 13,600 people have filed their 503 and 123 “short forms” through the Internet on their home computers, Golden said. The short forms are the 503, or Maryland Tax Return (Resident Individual) Short Form, and the 123, the Special Refund Request form.
About 70 percent of Marylanders usually file the long form, Golden said. Taxpayers still have to buy software to file the long form online, but it hasn’t seemed to deter them.
About 74,000 have filed the long form, the 502, online at home this year, compared to about 38,000 last year.
“Usually there’s a big surge at the end,” said Golden, but the Web site’s server is equipped to handle a last-minute swarm of online use.
The office also recommends online filing because it reduces the chances of mathematical errors. “The computer does all the computation for you,” Golden said.
Also, online filers who choose to receive their refunds via direct deposit will usually receive them within 48 hours.
Before Marylanders can pay their state income taxes online, however, they must complete their federal income tax forms. The federal forms are not on the comptroller’s Web site, so taxpayers must use other software, like TurboTax or H & R Block, or use the old-fashioned pencil-and-paper method.
However, not everyone is comfortable enough to file taxes electronically without any help.
The IRS and the American Association of Retired Persons collaborated to bring 30,000 Tax-Aide volunteers through the Volunteer Income Tax Assistance/ Tax Counseling for the Elderly program into local communities to help people prepare their income tax returns, including electronic filings, for free.
“The IRS prefers people to e-file,” said Julia Fegley, a Tax-Aide volunteer in one of Maryland’s 115 sites. “That’s the wave of the future.”
The IRS trains a nationwide corps of Tax-Aide volunteers to help with simple federal and state returns.
When a would-be taxpayer arrives at a volunteer site with tax information in hand, the volunteers can prepare the forms using TaxWise software. Then the volunteer transmits the finished form through the Internet.
“It’s ideal for single mothers and for people with simple returns,” Fegley said. “We don’t do complicated returns, and we don’t do business returns.”
Volunteers assisted with almost 16,000 state and 16,000 federal returns in Maryland last year, said Jan Cooper, Tax-Aide spokeswoman.
About 9 percent, or 1,538, of the federal filings were electronically filed last year. They don’t track the state electronic filings.
“There’s going to be a significant leap in that number in Maryland this year,” said Cooper, adding the program has obtained more computers and is training more volunteers to use them.
Fegley, who has professional tax service training, volunteers Saturday mornings in Anne Arundel County’s Knights of Pythias. On an average Saturday, she might prepare five or six returns on her IRS-provided laptop computer, and she will electronically file about half of those. She has seen a range of people, including single parents and couples with multiple jobs.
“It’s offered because it is difficult for a person who is not experienced with the tax law to understand all the implications,” Fegley said. “And (some) people are afraid of doing their own taxes.”