Despite some widely reported online tax-preparation glitches, almost 5 million tax returns were self-prepared on a home computer and electronically filed this year. That's a 104% increase over last year.
Still, last Thursday's column, which detailed the e-filing problems taxpayers faced this season, riled many readers. Several said they were shocked that I said we can rely on the Internal Revenue Service to fix these problems. And a few of you wrote in to challenge TurboTax's assertion that there were no "reported glitches."
Even though the tax-filing season is officially over, it's not too late to address some of these e-filing issues. Both TurboTax and H&R Block
(HRB:NYSE - news) report continuing traffic to the tax-preparation sections of their Web sites, with TurboTax processing 19,000 tax returns via the Web since April 18. "And we are still seeing lots of people in our local offices," says Neil Getzlow, an H&R Block spokesman.
If nothing else, perhaps we can learn some lessons for next year.
Trust the IRS?
Reader David Hanna was pretty amazed I had the nerve to report that the IRS is taking steps to ensure confidence in the electronic filing system.
"You mean to tell me that the public should trust the IRS' ability to audit private e-file systems? This is the same organization that won't guarantee the accuracy of the advice they give on their 800 numbers. Without extreme tax simplification, I doubt a majority will ever trust the IRS with electronic filing. We are so gun-shy we need a paper trail."
I understand your skepticism, David, but the IRS really is serious about reaching its goal of having 80% of the tax-return process done electronically by 2005. So it's in the IRS' best interest to get these sites working properly, says Bob Barr, assistant commissioner of electronic tax administration.
As of April 23, 30% of the 115 million returns filed were either e-filed or tele-filed (filed over the phone). That figure includes returns from do-it-yourselfers as well as those filed by H&R Block and other professional tax-prep firms, and it's up from 26% last season. Although there's still a long way to go, the numbers are moving in the right direction.
Glitch-Free TurboTax?
While many of you were very pleased with your TurboTax experience, a few of you did encounter some hiccups. We researched these problems and found some solutions -- or at least explanations -- for some of you.
Printing Problem
Marianne Stachtiaris wrote in because "the program would not display or print out my returns. I did everything the program suggested to try to get it to work. Fortunately, I had purchased the bricks-and-mortar version as a backup, and it worked fine."
TurboTax for the Web requires that you pay before you preview or print. In addition, the program requires that you have Adobe Acrobat Reader software installed on your PC in order to view those files. Hopefully, that helps.
Can't Import Info
Susan Talbot had a tough time downloading her capital gains information from Fidelity, which allowed her free access to TurboTax for the Web.
Here's why: Even though Quicken software allows you to download information from participating brokers, then transfer it to TurboTax, the Web version of TurboTax has no import option, says TurboTax spokesman Paul Vertucci.
There was a pilot program with Salomon Smith Barney this year that allowed TurboTax for the Web users to import their Form 1099 brokerage information. Fortunately, it was successful, and there are plans to broaden that option next tax season, says Vertucci.
Social Security Woes
A few of you had Social Security problems that came up while filing electronic returns but weren't really the result of a technical glitch. In fact, e-filing can be credited with bringing them to light.
Dan Peirce said that after much angst, he realized his daughter's Social Security number was wrong. "It turns out a bad digit has been propagating through my returns during the 1990s, and only an electronic process could catch it. I now know that what I thought was a 9 is really a 4."
And Darlene Jewell said her tax return was not accepted by the IRS because someone had already used her Social Security number. Hmm. That's a problem the Social Security Administration is going to have to look into further.
Can't Find Your DCN Number?
A few weeks ago we reported that after e-filing your tax return using a tax-preparation site you had to wait up to 48 hours to hear back from the IRS. If your return was accepted, the Service sent you a DCN, or declaration control number, which had to be recorded on Form 8453-OL -- U.S. Individual Income Tax Declaration For On-line Services Electronic Filing, along with your signature, and mailed the next business day.
But if you had filed electronically in previous years, you should have gotten an e-file Customer Number, or ECN, on a four-part postcard. If that's the case, you did not have to wait for your DCN. In fact, you wouldn't even be assigned one. Your job was done when you pushed the send button to file your return.
More than 1.4 million taxpayers used an ECN and had a completely paperless 1999 tax season. And the IRS plans to issue many more ECN numbers next year.
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