One reason for the increased popularity of electronic filing: The return time for paper tax forms was 12.5 days last year; for electronic forms, 4.4 days.
SPRINGFIELD – Five years ago, the accounting firm of Moriarty and Primack P.C. filed more than 50 percent of its clients' tax returns on paper.
This year, the figure had dwindled to 2 percent, mirroring a national shift in the way Americans file taxes with state and federal government.
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More and more taxpayers are filing electronically.
“It’s something that just took off overnight,” said Rodney D. McCorkill, director of tax compliance for the Springfield firm.
The vast majority of taxpayers began filing tax returns electronically in the past five years – a trend driven by the public’s growing reliance on electronic communication and a federal mandate requiring accounting firms to offer electronic filing.
Last year, nearly 100 million taxpayers filed federal tax returns electronically.
Last year, 2,817,194 of 3,512,422 returns were filed electronically in Massachusetts, and the figures for this year suggest the trend is accelerating, said Ann C. Dufresne, communications director for the Department of Revenue.
By Thursday, 1,507,035 electronic tax returns had been filed with the state, compared to 179,065 filed on paper, according to Dufresne, who said her agency is not only accommodating the trend but actively encouraging it.
One reason for the increased popularity of electronic filing: The return time for paper tax forms was 12.5 days last year; for electronic forms, 4.4 days.
“The Department of Revenue is not unlike any other state agency with direct contact with our customers. We are trying to be more efficient and trying to deliver customer services in a new way,” she added.
Indeed, between 2001 and 2011, the number of paper-filed returns dropped from 1.47 million to 206,920, with the sharpest reductions coming since 2008, she said.
Filing electronically makes economic and environmental sense; the cost of mailing, processing, copying and eventually shredding paper documents exceeds $1 million a year, according to revenue department estimates; plus, eliminating huge mountains of paper has the added benefit of sparing huge numbers of trees, Dufresne points out.
“We are very paper-centric agency; whatever we can shift to online and electronic makes us more efficient,” Dufresne said.
In Springfield, the transition has been mostly painless for taxpayers and tax preparers, said McCorkill, whose firm handles about 1,500 returns a year.
While some customers, particularly the elderly and cyber-phobic, are reluctant to embrace the change, that number shrinks each year as people grow comfortable with the process.
“So far I haven’t seen the downside yet,” he said.
“If people still want to file paper returns, we’ll do it that way; we give them the forms and they can take them down to the post office and mail them,” he added.
In related news, the state Office of Consumer Affairs warned the public last week about deceptive tax service advertisements that promise to reduce back taxes for cents on the dollar, regardless of how much the taxpayer might owe.
Consumers should be skeptical of these claims even if they seem legitimate, said Under Secretary of Consumer Affairs and Business Regulation Barbara Anthony.
The U.S. Internal Revenue Services’ so-called “Offer in Compromise” program is the only way for a consumer to settle tax debt for less than what is owed, Anthony said.
The consumer affairs agency also announced the launch of its newest website, a tool designed to teach consumers about what to look for in scam websites.