USING THE INTERNET TO PAY TAXES

USING INTERNET TO PAY TAXES

Using Internet To Pay Taxes

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Abstract

This research essay analyses the online tax filing system in USA , its associated advantages and disadvantages and also risks involved and how to avoid the same . Further , it also suggests how a new tax administration can be initiated through a website and how e-governance can be introduced to tax administration in Switzerland

1 . OBJECTIVE

Online tax filings make tax returns filing and payment of the taxes easier

and less cumbersome . Now in USA , both state and federal tax forms and instructions are available online and it can be easily downloaded from the website HYPERLINK "http /www .irs .ustreas .gov www .irs .ustreas .gov . Tax returns can be now d through Internet and tax payments can be made through online . Online filing through Internet is speedier , expedient and more precise than the traditional filing scheme . Under this method , IRS confirmation for filing tax returns is acknowledged instantly through online . Further , it also facilitates the IRS to forward the d tax return data 's to the concerned state agency

One another major advantage is that the any tax refund can be deposited to the taxpayer 's account through the electronic Direct Deposit system thereby making turnaround time from filing tax return to receive tax refunds within few weeks

Online tax filing has been introduced by the IRS mainly to ease the hardship of calculating taxes and filing tax returns especially for Net-savvy taxpayers . IRS launched the online tax filing services as early as 1996 through its official website namely HYPERLINK "http /www .irs .ustreas .gov " www .irs .ustreas .gov . This has facilitated the tax payers to download the tax forms through online , to know about instructions , to receive important highlights of tax law clear doubts by going through FAQ section [frequently asked questions] and above all serve as an interactive channel to find solution to common tax problems . It is to be observed that during the first year of operation , IRS website had more than 100 million hits and more than 3 million documents were downloaded by the taxpayers . In the year 1997 more than 14 million returns were d electronically . However presently online services have been expanded to facilitate taxpayers to not only their federal but also state returns through online According to IRS Oversight Board , in the year 2006 alone , about 55 of all tax returns are d online . [Cooper , 1998]

IRS also introduced online tax returns to charities also with effect from January 1 , 2004 and also conducts more audits of charities and enhances the sharing of information with states . Further , IRS also placed Form 1023 , the application for tax-exempt status online

[Schwinn , 2002 ,

.24]

According to IRS Restructuring and Reform Act of 1998 , a target of 80 electronically filing tax returns was set by 2007 . However , the actual online filing during 2007 was only 58 and IRS realized that target could not be met . Hence , the...