Getting The Irs To Cough Up Quicker

You're anticipating a hefty tax refund and you don't want to wait long for Uncle Sam to pay up. By filing your income taxes electronically, you can speed your refund by several weeks.

Electronic filing is on the rise. The Internal Revenue Service expects that 14.6 million 1993 tax returns will be sent electronically, compared with 12.3 million the previous year. (Twenty-three states allow you to file state taxes electronically.)

The key benefit for most individuals is a faster refund, although people who owe money may also participate. Folks who file paper returns early can usually expect a check from the government within four to six weeks. Those who stall until deadline time may have to wait two months. Yet electronic procrastinators can get a refund within three weeks, even sooner if the refund is directly deposited into a bank.

In addition, the IRS claims high-tech returns are more accurate. The error rate on paper runs around 15%; it's less than 2% on electronic returns. Another plus: The IRS notifies electronic filers that returns have been received.

Most individuals can't use their own modems to zap data to the government. Instead, they must visit tax preparers dubbed electronic-return originators by the IRS. These outfits usually charge a fee, so you must weigh this tab against the size of the coming refund. Most H&R Block offices charge $35 to transmit already-prepared returns from individuals--$25 if H&R Block has prepared

THE RETURN. Jackson Hewitt waives its average $49 fee when it prepares a return. Not all paper is eliminated. Folks must still lend signatures to verification forms and send W-2s and other supporting documents to the IRS.

People wanting to taste refunds in days rather than weeks can take out a loan. Working with banking partners, Block, Jackson Hewitt, and others can provide loans within two to four days against the expected refund. At Block, the average loan fee is $29. You must be getting a refund of at least $330; the maximum loan is $3,300. Fees are fixed so the smaller the refund, the more you're effectively paying in loan interest. Unless you really need the money fast, it's best to avoid this costly


The IRS has been experimenting with other ways of gathering tax data. Seven states now offer filing by phone, though only single persons with incomes under $50,000 who receive a TeleFile packet by mail may file that way. Callers punch in wage, interest income, and withholding figures, and within minutes learn the size of their refund or how much they owe. It could give new meaning to the term "wrong number."

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