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Valerie Potter's picture
Valerie Potter

Techalicious

More posts | Read bio

February 26, 2009 - 1:09 P.M.

Do you file your taxes online?

10 comments

The move to online tax filing in the U.S. continues apace, according to a new survey from The Conference Board and TNS:

About 40 percent of online households are planning to file their federal taxes online this year, up from less than 34 percent four years ago, according to The Consumer Internet Barometer, a quarterly report produced by The Conference Board, the global business research and membership organization, and TNS, a global market insight and information group. The report surveys 10,000 households across the country and tracks who's doing what on the Internet.

The report notes that the security of online tax filing is less of a concern for consumers than it was a few years ago:

Those who are extremely concerned with the security of filing taxes online have dropped from about 50 percent in 2005 to only 36 percent today. Conversely, those who claim they are not very concerned or not concerned at all have increased to nearly 40 percent from 27 percent five years ago.

Really? With a steady stream of data breaches and a rising tide of identity theft over the past few years, people are less concerned about sending their most personal of personal information over the Internet?

I certainly understand the appeal of online filing -- it's quick and convenient and much greener than printing out paper. But I just don't think the security risks are worth it.

I'm sticking with paper filing for the foreseeable future -- what about you? Do you plan to file your taxes online this year? Why or why not?

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What People Are Saying

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What makes you think paper is more secure?

Submitted by motie38 on March 2, 2009 - 3:50 A.M.

I've used TaxAct for years with narry a worry. If I owe the IRS money, I file a paper return on April 15. If they owe me money I file electronically.

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Re: Do you file your taxes online?

Submitted by Kaye on February 28, 2009 - 3:03 A.M.

Yes, I have filed online for several years, but only after checking site security and their privacy policy. I prefer the convenience of online filing, and with direct deposit, I get my money back quicker. I keep up with changes in the tax laws, most of which don't apply to me, and I refuse to give *&*Block my hard-earned dollars for something I can do myself.

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Why bother?

Submitted by Anonymous on February 27, 2009 - 8:25 P.M.

Does the government pay you to be its bookkeeper? So why are you providing this service to them for free for taxes that are illegal anyway? Read your history. The income tax was supposed to be temporary to pay for war costs.

I quit paying taxes many years ago. I haven't filed a return in 11 years. I buy everything in a state that has no sales tax. My vehicle is registered in another country. My retirement fund is offshore. Wise up. Stop being a sucker. Live for yourself and your family, not a bunch of fat, lying, thieving politicians and bureaucrats who get better pay and benefits than you ever will, at your expense. Buy your medication from another country and stop subsidizing the billion-dollar ad campaigns of US pharmaceutical companies. Stop being a doormat for big business and big government.

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Nosey Software

Submitted by Taxpayer on February 27, 2009 - 2:16 P.M.

Several years ago I did my taxes with a popular software package. After I finished entering all my data, my firewall alerted me that the program was trying to contact the software company. My tax info is none of their business and I didn't let it pass. Instead of electronic filing, I printed it out and reentered the info on the paper forms and mailed them. From then on, I just used the IRS forms each year.

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Not more convenient for me...

Submitted by Anonymous on February 27, 2009 - 9:22 A.M.

I looked at online filing for the first time this year, and it doesn't look more convenient to me. Actually, it looks quite a bit *less* convenient, which is why I filed on paper again this year. Doing both my fed and my state on paper took about 40 minutes. If I had done it online, it probably would have taken at least twice as long, probably much more than that.

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Yup

Submitted by Kilgore on February 26, 2009 - 10:19 P.M.

I think Trevor is probably right in that it all ends up in the same DB anyway.

I've filed online for about 10 years.

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I think most information

Submitted by Trevor Burnette on February 26, 2009 - 2:15 P.M.

I think most information theft is from database breaches or employee laptops with confidental data and not information in transit. Your paper return still ends up in the same database as my electronic return.

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good point

Submitted by Valerie Potter on February 27, 2009 - 12:22 P.M.

Trevor, that's an excellent point.

There have been some cases of data stolen while in transit (see "Hackers open new front in payment card data thefts"), but that data was being transmitted from point-of-sale systems to payment processors, so it's a somewhat different scenario from filing taxes from a home computer.

You're right that the vast majority of information theft is from stolen laptops and database breaches, and that taxes filed on paper will likely end up in the same database as taxes filed online. So much for my false sense of security. ;-)

Thanks for commenting!

Valerie Potter
Computerworld

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In fact:

Submitted by Anonymous on February 27, 2009 - 10:44 A.M.

Have there ever been *any* documented instances where data was intercepted in transit? Last I heard (which, admittedly, was a few years ago), it had never happened.

I'd be far more worried about bored IRS employees poking thru people's returns just for kicks -- there *have* been cases where that's happened, even though it's illegal.

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Not yet ...

Submitted by George on February 27, 2009 - 11:55 P.M.

but it's only a matter of time.

I would never do my taxes online with a web application, but I have considered electronic filing from my desktop tax application. I've never done it ... I've just considered it.

You can't directly submit an electronic return yourself, the IRS requires it to go through a licensed agent such as H&R Block (Tax Cut) or Intuit (TurboTax). The agent collects the returns and batch uploads them to the IRS. I see a lot of potential for hacking the agents' servers and/or for a man-in-the-middle attack on the agents' web sites. Not to mention that the IRS itself routinely gets a failing grade in network security - although the custom nature of its systems and applications makes an outside hack less likely.

However, snail mailing a return is just as dangerous unless you send it "certified" which maintains a chain of custody for the package and costs too much. The Postal Service hires lots of temporary workers at tax time and some of them may be there to steal. Certified mail can be stolen or read along the way too, but the handling procedures are supposed to ensure that everyone who touches it can be identified.

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