Wednesday, April 05, 2000

Many Ohioans find e-returns less taxing

About 1.1 million filed

Enquirer Columbus Bureau

        COLUMBUS — More Ohioans than ever are using the Internet or their telephones to file their state income-tax returns this year.

How to file electronically
        As the April 17 tax deadline nears, Ohio residents have filed more than 1.1 million “e-returns,” a figure that promises to far surpass the 1 million electronic returns filed in 1999. That puts the Buckeye State at the leading edge of a high-tech trend that offers taxpayers fast refunds while cutting tax collectors' costs.

        Ohio ranks second among states that report accepting electronic income-tax returns, according to the Internal Revenue Service. Only California, with 1.6 million collected so far, has more.

        “Our goal is to have (1.7 million) returns filed paper-less this year,” said Tom Zaino, Ohio's tax commissioner. “I think we're well on our way to meeting it.”

        Mr. Zaino and Cincinnati-area tax preparers say fast refunds are the main reason e-returns are becoming so popular.

        Households that electroni cally file can get a refund in about two weeks because the returns get zapped right into the Ohio Department of Taxation's computers. Paper-return refunds can take two months or more because state workers have to read and type in the information.

        “We have hundreds of people and all they do — all day — is type in data,” Mr. Zaino said.

        Ohio took in 5.2 million tax returns last year, 80 percent of which were on paper. More than half those returns were filed in April.

        It's no secret refunds take longer as paper returns pile up. Carol Howarth, a Cincinnati regional manager for tax preparer H&R Block, said some of her customers have waited until July to get their refunds.

        “That's why most of our clients file electronically,” Ms. Howarth said. “It's much faster.”

        It also is cheaper. It costs the state an average of 70 cents to process a paper return, but about 30 cents to handle an e-return, said Department of Taxation spokesman Gary Gudmundson.

        While Mr. Gudmundson and Mr. Zaino hope to someday see the majority of state income-tax returns filed by phone or computer, they also acknowledge that electronic filing is not for everyone.

        The state notifies taxpay ers if they are eligible to file by phone on the tax forms it mails them. While anyone can file over the Internet, a taxpayer must have the right software on his or her home computer or go to an accountant who is hooked into the state's system.

        Those who earn more money and fill out more complicated returns also are more likely to file the old-fashioned way.

        Jerry Taylor, a certified public accountant, says most of the 600 tax returns his West Chester firm will file this year will be on paper.

        “We certainly do electronic filing,” Mr. Taylor said. “I don't think it's 10 percent of our business.”

        Finally, e-filing does nothing to encourage people who owe on their taxes to file any faster. Ohioans filed 2.2 million state income-tax returns by the end of March. Approximately the same number of returns was filed at the same time last year.

        “A lot of those people who file early are getting refunds,” Mr. Zaino said. “If you know you have to pay, a lot of people would rather do it in April than in January.”

        The average state income tax refund this year will be about $223. Mr. Gudmundson estimates one out of every four Ohioans will write a check to the state treasury.


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