The growth of electronic tax filing has prompted DOR to make changes in the booklet of forms and schedules that are mailed to taxpayers. A minority of taxpayers, less than 300,000 out of 3.4 million tax filers, submitted state income tax returns on paper last year using the form DOR sent to them in the mail.
Those same taxpayers will receive a paper booklet in January, 2011, but it will be a slimmer version than in years past because it will not have printed instructions or duplicate copies of tax forms and related schedules.
In making these changes, DOR will save the Commonwealth more than $120,000 in printing and mailing costs. But DOR has not undertaken this change for that reason alone. While not quite yet an antique, the paper tax form is clearly headed in that direction. Just as the day of taxpayers jamming post offices at the last minute to mail returns is a thing of the past, so too are paper returns.
Electronic tax filing is far more efficient and accurate for both taxpayers and DOR. The Department is able to process electronic returns more quickly, which means e-filers can received their refund in as little as three business days while refunds generated by paper returns take far longer, especially as it gets deeper into filing season.
Electronic filing is also more environmentally friendly, both in the amount of raw material and energy used to produce the booklet, and in the time and expense required for its processing and eventual disposal.
Those filing paper tax returns who need to reference instructions will find them at DOR's website. For those without a computer, printed copies of instructions will be available for reference at local libraries.
There is a free, secure and easy-to-use tax filing DOR has developed called WebFile for Income which contains detailed online instructions, performs mathematical calculations and electronically files your return directly with DOR. WebFile securely stores your tax return data, allowing future filings with DOR to be even quicker and easier.
One final point. Electronic filing in 2010 accounted for 2.418 million returns of the nearly 3.4 million returns filed. Taxpayers who filed paper tax returns using the booklets DOR mailed accounted for another 250,000 returns. So what about the remaining 700,000 or so tax filers? How did they file?
Most of them came within a click of filing electronically; that is, they used a commercial software tax package and then, instead of submitting the tax return electronically, they hit the print key and mailed a paper return to DOR. Taxpayers in this group should seriously consider using WebFile for Income, which, unlike their commercial tax software, is free. But if you use commercial software, try hitting the send key.
It's worth noting that the federal Internal Revenue Service announced in October that it will no longer mail paper income tax packages to either businesses or individuals. In its press release, the IRS said it "was taking this step because of the continued growth in electronic filing and the availability of free options to taxpayers, as well as to help reduce costs."
Editor's Note: The Providence Journal, which covers portions of Southeastern MA., has just published an informative survey of the mailing of tax forms in RI, MA, CT and at the IRS.