Analyst Report: More People Filing Taxes Online

FRAMINGHAM (04/17/2000) - With the tax deadline only hours away for most of the country, International Data Corp. in Framingham, Mass., today released research indicating that 30 percent more people are filing their income taxes online this year than last year.

The deadline for most of the country is midnight tonight. However, taxpayers in the Northeast who file their taxes through the Internal Revenue Service processing center in Andover, Mass., have until midnight Tuesday, because today is a legal holiday in Massachusetts.

IDC's findings were backed up by IRS figures, which show that electronic filing hit a new high this year. As of April 7, the IRS said taxpayers had filed nearly 30.7 million returns electronically, 17.4 percent more than were filed electronically for all of last year. The IRS said its e-file program is expected to receive more than 34 million returns this year.

In addition, the IRS said its Web site recorded 15 percent more hits than last year - 791 million - as of April 9.

IDC's research, presented in a report titled "U.S. Households Move to Online Tax Filing," indicated that most electronic filings were done by tax preparers rather than individuals. But the IRS said that, through April 7, more than 3.8 million filers prepared their own tax returns on computers, a 94 percent increase over last year.

IDC, which surveyed 1,000 households by telephone during the week of April 10, said individuals using professional tax preparers generally had lower incomes than individuals who filed their returns online themselves.

"This shows the success of special promotions targeted at this segment," IDC analyst Gigi Wang said in a statement. "Programs such as offering loans against anticipated refunds have enormous appeal."

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