Gov. Easley Announces Low Cost Online Tax Return Filing Options
Date: February 4, 2008
RALEIGH – Gov. Mike Easley today announced that taxpayers will have more options this year for filing their North Carolina tax returns online for free or at a minimal charge through the state Department of Revenue’s expanded electronic services program. He also warned taxpayers to steer clear of high-cost refund anticipation loans, which can substantially reduce the tax refund a person receives.
“North Carolina is one of the nation’s leaders in taxpayer use of electronic filing, which helps citizens get their returns processed more quickly and their refunds faster,” Easley said. “By using the state’s E-file partnerships, taxpayers can get their refunds in as little as two weeks and avoid the cost of buying tax preparation software and paying online filing charges.”
Last year, the state received more than 2.2 million electronically filed individual returns, 55 percent of the 3.98 million individual state returns filed with the Revenue Department. The Department’s web site has direct links to the online tax-preparation services. Online preparation of federal tax returns is available as well. Information on e-filing and links to the services can be found on the home page of the Revenue Department’s web site: www.dornc.com. Click on the “E-File” logo on the right side of the web page.
Eleven companies have signed on as participants in the state’s program to provide access, via the Internet, to online tax preparation and filing: TaxFreedom.com; TaxSlayer.com; TaxHawk.com; On-Line Taxes Inc; Average 1040.com; TaxAct; Tax$imple; 1040.com; ezTaxReturn.com; e-File Tax Returns, Inc. and eSmart Tax. These companies offer web-based applications that allow filers to prepare their tax returns without downloading software. Information about the fees is available at the different tax preparation service web sites. More companies are expected to join the program as the April 15 filing deadline approaches.
Easley advised taxpayers not to fall for offers of “instant refunds” from lenders who promise a quick turnaround on their expected refunds. These short-term loans can carry interest rates between 100 and 200 percent.
“The end result of these tax refund loans is that taxpayers lose some of their money for no reason,” Easley said. “By using the electronic filing options, the refund will already be fast and our citizens will get all the money they are due.”
It is estimated that nearly half a million North Carolinians got tax refund loans last year at a cost of more than $44 million dollars that went to lenders instead of to taxpayers. Even worse, 86 percent of the loan applications were from low income borrowers, who can least afford to pay high interest rates.
The Department of Revenue reminds citizens on its website that taxpayers who file through online companies are under no obligation to use refund anticipation loans or purchase any product from the participating company. The N.C. Office of the Commissioner of Banks has more information about tax refund loans and how to avoid paying too much for one on its website at www.SaveTheRefund.org. Information on the site includes:
- how to file taxes electronically for free;
- how to gain assistance in preparing tax returns through Volunteer Income Tax Assistance sites;
- how to find lenders that offer short-term loans;
- how to shop for the least expensive refund anticipation loan and find the nearest refund anticipation loan facilitator; and
- how to qualify for the Earned Income Tax Credit.
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