Tennessee is No. 1 in electronic tax filing; most turn to Internet as deadline looms

A stack of 1040 Income Tax forms sit on display in this file photo.
A stack of 1040 Income Tax forms sit on display in this file photo.

Maybe it's the Gig City influence: Tennessee is going digital when it comes to Tax Day.

As of Monday, the state had filed more electronic federal income tax returns per capita than any other state in the nation.

U.S. Postal Service office hours

* 6050 Shallowford Road, Chattanooga, 8 a.m. to 6:30 p.m. * 134 N. Market St., Chattanooga, 8:30 a.m. to 5 p.m.

Last-minute filing information

* The income-tax filing deadline is midnight April 15. * United States Postal Service offices will be open regular hours on April 15. Locations, hours and pickup times for post offices, self-service kiosks and collection boxes can be found at usps.com or 1-800-ASK-USPS. * Tax forms are no longer available at post offices. Instead, check online at irs.gov for federal forms, tn.gov/revenue/forms for Tennessee forms and georgia.gov/documents/forms for Georgia forms. * The IRS Free File program offers free tax return preparation and free e-filing to households with an adjusted gross income (AGI) of $60,000 or less through a partnership with software companies. To file, go to irs.gov/uac/Free-File:-Do-Your-Federal-Taxes-for-Free, or go to irs.gov and click on the Free File link. * People who haven't finished their returns can get an automatic six-month extension, through irs.gov. The free service is available regardless of income. Taxpayers also can get an extension by mailing in form 4868, available at irs.gov. Sources: Internal Revenue Service, United States Postal Service

photo FILE - This Aug. 21, 2014, file photo shows health care tax forms 8962, 1095-A, and 8965, in Washington. Several million people hit with new federal fines for going without health insurance will get a second chance to sign up starting Sunday, March 15, 2015, and that could ease the sting of rising penalties for being uninsured. (AP Photo/Carolyn Kaster, File)

"It's tops," said Internal Revenue Service spokesman Mark Green. "The state of Tennessee has set a record."

Tennessee taxpayers also had filed more returns by Monday than they ever have this close to the April 15 deadline.

"All the people have stepped up to the plate and filed their returns much earlier than they have in past years," Green said. "This has been the most returns we've ever received from the state of Tennessee at this point."

The IRS estimated that 2.1 million returns would be filed electronically from the state for the calendar year. As of Monday morning, more than 2.1 million had been filed, with an average refund of $2,893. About 2.9 million total returns, paper and electronic, are expected from the state. The filing deadline is Wednesday at midnight, though taxpayers can get a free extension through irs.gov or by using paper form 4868.

The IRS has been encouraging taxpayers to file through its secure online system, but many people weren't initially comfortable with the idea.

"There was a little consternation at first," said Kevin Rose, a partner at local accounting firm Henderson Hutcherson & McCullough. "It's been a couple of years, and everyone is more comfortable with it. ... Everyone is always moving to having everything done electronically."

Rose offered what the IRS claims is the benefit of online filing: It makes people's lives easier.

"There's a lot less paper shuffling," Rose said. "They don't have to go to the mailbox."

Filing online also means that tax refunds arrive in about 21 days compared with six to eight weeks for paper returns. Plus, the IRS offers free online tax return preparation and e-filing to households with an adjusted gross income of $60,000 or less, through its Free File option.

The digital trend has picked up enough for post offices to nix late April 15 hours.

The U.S. Postal Service office on Shallowford Road in Chattanooga was open until midnight every April 15 until several years ago, said Randy Bowen, one of the location's supervisors.

"People just aren't mailing near as many tax returns as they used to," Bowen said. "The IRS has put a big emphasis on electronic filing. The last couple times we were open late, it was just very slow."

Go back longer, and the Shallowford location had staff outside near turn lanes to pick up envelopes from taxpayers in cars, he said. "The ones who had postage on it, they could just hand it to our clerks. We used to have quite an elaborate setup."

Not everyone is thrilled with sending sensitive financial information over the Internet. This is the second year that Tennessee's Hall income tax can't be paid with a paper check (unless the filer has a hardship).

Soddy-Daisy retiree Bob Flynn was uncomfortable with sending the state his bank routing number online, but ended up doing it anyway.

"I don't believe I should have to send the government my bank account number and routing number over the Internet; I should be able to send them a check," Flynn said. "It just seems wrong to me."

Rose said he has had clients of the same mind this tax season, especially those of an older generation. In several cases, his clients sent in paper checks. "My expectation is that the state of Tennessee will not refuse a check if it's hard copy or electronic."

For those who still have to file federal taxes and plan to do so by mail, the U.S. Postal Service recommends getting proof of delivery (certified mail service with a return receipt). Also, the IRS won't pay postage due on items with insufficient postage (the cost of a 1-ounce letter is $0.49 and $0.21 for each additional ounce).

Contact staff writer Mitra Malek at mmalek@timesfreepress.com or 423-757-6406. Follow her on Twitter @MitraMalek.

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