While most people still file their taxes the traditional way, withpencils and erasers, more are discovering the benefits of electronicfiling.
Only 34 percent of US and 20 percent of Massachusetts taxpayersused e-filing last year, but the Internal Revenue Service projects an11.9 percent increase nationwide this year.
Many still resist doing their taxes on their computers, fearing itmay be difficult, said Andrew Judd, associate professor of accountingat the University of Central Florida in Orlando. In reality, Juddsaid, computer filing - whether online or with boxed software - savestime while eliminating math ema tical errors.
Mike Bronstein, former chairman of the New York State Society ofCertified Public Accountants, insists there are only slightdifferences among the commercial online tax-filing programs.
"They all hook up with the IRS on the Internet," he said.
But both Cameron Routh, vice president of marketing at Gainskeeper3.0, and Ernest Zoumot, senior marketing manager at CCH Inc.,disagree.
"Some products have had massive promotional campaigns behindthem," Routh said. "Others are just inherently better. TurboTax, forexample, has been in the spotlight because it's an excellent product.And that's coming from a competitor."
As for Gainskeeper, "we only do capital gains calculations," Routhexplained. "It is completely automated; no adjustments are required.Information can be exported to any part of a return."
CCH, in the tax software business only four years, sells both aconsumer and a professional product. Zoumot said the consumerproduct is designed for working people, while the professionalproduct is for consulting, accounting, or law firms.
One advantage of CCH is that you don't have to downloadinformation because it's all on the Web. "You simply log in [and]answer basic questions such as filing status and Social Securitynumber," Zoumot said. "It doesn't take a brain surgeon to racethrough the questions. One set of questions triggers the next roundof questions."
Because CCH uses secure encryption, the chances that data will bestolen are remote, the company says.
A recently introduced system allows filers earning $16,000 or lessto file directly through the IRS. On the other hand, online filingclearly isn't for everyone.
"The main benefits of e-filing are that there is no charge, andthe quickness in getting refunds," said Gary Savage, senior vicepresident of Rinet Company LLC, a financial and tax consulting firmin Boston. "Our clients can't take advantage of e-filing because ofthe complexity of their returns."
The IRS has a strong incentive to make it easier for taxpayers tofile online. The agency is under a congressional mandate to have 80percent of individual filers file electronically by 2007. That goalstems from a partnership agreement between the IRS and the private-sector Council for Electronic Revenue Communication Advancement.
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