Young Taxpayers Head Online to Prepare Taxes, Online Taxpayers More Likely to E-file, CompleteTax Survey Finds

Online tax prep surpasses packaged software overall, accuracy and maximizing credits and deductions top list of important requirements

(RIVERWOODS, ILL., January 11, 2010) – More than one in five taxpayers say they’ll be turning to online or packaged tax software to prepare their taxes, with young taxpayers the most likely to choose online tax prep, according to an independent survey of more than 1,000 respondents conducted for CompleteTax®, an online tax preparation and e-filing service for the do-it-yourself taxpayer.

The CompleteTax Tax Prep Survey, conducted for CompleteTax by Opinion Research Corporation, also found that people preparing their taxes online are by far the most likely to also electronically file their tax returns. The IRS e-filing program for 2009 taxes starts January 15.

Taxpayers also say getting their taxes done right and making sure they’re getting all the tax credits and deductions they deserve are among the most important factors in preparing their taxes, according to the survey.

“Particularly in a tough economy, taxpayers are taking more control in getting their taxes done right and cost-effectively,” said Gary Lundberg, product management director for CompleteTax. “They want to make sure they’re not paying too much in taxes or paying too much to prepare and file their taxes.”

Online Tax Prep Surpasses Packaged Software

According to the CompleteTax Tax Prep survey, the majority of taxpayers (60 percent) plan to use an accountant or professional tax preparer. Also, the number of taxpayers turning to online tax programs now narrowly surpasses those planning to use packaged software with 11 percent saying they’ll go online compared to 10 percent saying they’ll buy a packaged program. The survey also found that 17 percent of people report they’ll try to do their taxes manually with no help from a CPA or tax program.

Age seems to be an indicator of how taxpayers will do their taxes. Online tax preparation is most popular among people 18-34 years of age, where 16 percent plan to use online tax programs and 8 percent packaged software compared to just 2 percent of taxpayers 65 or older using online tax prep and 6 percent using packaged software. Those 65 and older are the most likely to use a professional tax preparer, with 69 percent saying they will do so, compared to just 55 percent of 18-34 year-olds opting for this approach.

“Use of online tax programs is gaining momentum for a number of reasons,” said Lundberg. “A generation has now grown up regularly banking and paying bills online, and they are comfortable with the process. Online tax programs, such as CompleteTax, also allow you to try before you buy, making certain the program matches your needs, and offer a version that’s entirely free. So it’s an easy, safe and risk-free way to get your taxes done.”

Accuracy Tops List of Factors Important to Taxpayers

When it comes to preparing their taxes, people want to make sure their taxes are done right. Specifically, the survey found that the three most important factors to taxpayers are ensuring their taxes are prepared:

• Accurately (86 percent);
• Safely and securely (76 percent); and
• With access to the expertise and support they need (70 percent).

More than one-half of taxpayers also said affordability, ease of use, maximizing their refund and speeding completion of their return are important factors in how they decide to prepare their tax returns.

Getting the Credit Deserved

Accuracy is important in both ensuring that taxpayers don’t end up in hot water with the IRS as well as making sure that they aren’t paying more in taxes than needed.

According to the CompleteTax survey, taxpayers’ top concerns in preparing their tax returns are:

• Overlooking a tax break that could save money or increase their refund (66 percent);
• Making a mistake that could cost them in penalties (66 percent); and
• Making a mistake that could trigger an audit (57 percent).

“Taxes are complicated and intimidating, and there’s a lot at stake. People want a solution that’s simple to use and one they know is accurate, secure and will make sure they’re not paying more than they should,” said Lundberg. “Also, many people want the comfort and reassurance of professional audit assistance to make sure they have expert support if they’re audited.”

E-filing Most Popular Among Online Tax Prep Users

Overall, two out of three taxpayers (67 percent) plan to e-file their 2009 tax returns, according to the CompleteTax survey. People that prepare their taxes online are significantly more likely to say they will e-file their tax return than taxpayers using any other form of tax preparation. Specifically, 84 percent of those preparing taxes online say they will e-file, compared to 72 percent using an accountant, 72 percent using packaged software and 34 percent completing their return with no help from a professional preparer or tax program. E-filing also is more popular among younger taxpayers, according to the CompleteTax survey.

“Now more than ever, taxpayers should consider e-filing,” said Lundberg. “It’s easy to do, costs nothing extra and can speed their refund – especially if they also choose direct deposit for their refund.”

About CompleteTax

CompleteTax (www.CompleteTax.com), an online tax preparation and e-filing service for the do-it-yourself taxpayer, is the smart, simple solution for people who want to get their taxes done quickly, easily and accurately and maximize their tax refund. CompleteTax offers comprehensive resources for preparing and e-filing both federal and state income tax returns. CompleteTax is developed by CCH, a Wolters Kluwer business (CCHGroup.com), a leading provider of tax, accounting and audit information, software and services. Wolters Kluwer is a leading global information services and publishing company (www.wolterskluwer.com).

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