Brave New (e-file) World
You may have heard something about our kinder, gentler IRS deciding that taxpayers need to climb on the e-file bandwagon, and you may be wondering just what this e-filing has to do with you.
Or, perhaps you are one of the lucky 33 million taxpayers who received a strange e-file postcard in the mail last December and are wondering what, if anything, you are supposed to do with that card, not to mention wondering where you put it.
E-file is the federal government's latest tactic in its never-ending effort to provide taxpayers with the opportunity to not notice that they are paying any taxes. For those of you who can remember back to the days that preceded July, 1943, you may recall a time when those who paid the income tax (only the wealthiest people in the country had to pay), saved their money and made one payment to the Internal Revenue Service each spring.
Where it all began
Then, in July 1943, with the costs of World War II raging, the government seized on a great idea which at that time was known as 'pay as you go' The idea was brilliant in its simplicity and contemptible in its indifference to the rights of hard working citizens to choose how and how much of their money is spent for government programs.
Here,s how the plan worked: Force employers to take the tax money out of the wages of employees before the employees ever receive their wages. This way the government can raise taxes without people feeling the great burden of writing large checks to the IRS.
Once the dust settled from the initial shock of lower take-home pay, the game was afoot. The war ended, but new programs were developed to take the place of paying for soldiers and weapons, and the result is what we have today: a government with the momentum of a driverless steam roller, an entity with a life of its own, stopping at nothing in its path.
Today, our taxes are withheld at the source; we never even get our hands on approximately one-third of the money for which we work. Money that could at the very least be earning interest for us in a savings account for the year before we turn it over to the government, is instead already in Washington and being put to the various worthy uses chosen by the representatives we elect to Congress.
Back to the future
That said, let's take a look at the latest great idea that is permeating the minds of our tax collectors in Washington. The process known as e-file, which will no doubt become a household word in the next decade, enables taxpayers to file paperless tax returns. You fill in the blanks on a computer screen, or better yet, go to a library or community center and have someone else fill in the blanks for you, telling how much money you earned during the year, then you provide your bank account number, and the IRS will very efficiently (in half the time it takes to process a paper tax return!) remove the money it deems appropriate from your bank account in order to square you with whatever taxes the IRS says you owe. You never even have to see the tax return or the total amount of tax you have paid.
If this doesn't frighten every taxpayer to the bone, consider the following scenario. Years from now, in a world that seems only science fiction to us today, people will continue to go to jobs, and they will report their earnings to the government by some sort of e-file system, and provide their bank account number (actually the government will already have this number along with all the other personal information it has stored about every citizen), and someone at the government will decide how much income you need to live on, and route an appropriate amount of your earnings to your bank account for your personal use.
Back to the Present
Meanwhile, if you are interested in using the e-file
system so that you can get your refund a few weeks quicker, which is the only
logical reason to use e-file at all, any tax preparer will help you, or you can
prepare your tax return on your personal computer using any of the currently
available tax software programs and dispatch your tax return over the Internet,
or you can even go right to the web sites of the major tax programs, such as www.turbotax.com or www.taxcut.com , and file your tax returns right from the web site.
It certainly appears that e-filing is going to be the wave of the future. I'm just not sure I'm ready to ride that wave.
Copyright © 2000 Gail Perry - Fun with Taxes
Voice of the Editor
Which isn’t completely true. I mean, occasionally I drop by when I manage to sneak out of the nonstop frat party over at Going Concern, but I’m mostly a wallflower over there. I’m happy to say that I’ve been given express permission (or explicit orders, if you like) to wander over here to AccountingWEB more often.
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