and gas drilling programs,” says Hall. “Both offer tax benefits to investors, if you work with the right people. But you shouldn’t wait until the end of the year when there is a rush to find tax shelters.” Andre DeBose is among the clients considering such ventures now, says Hall.
THE PUSH TOWARD E-FILING
This year marks the first time that corporations and tax-exempt organizations have the option of filing their annual income tax returns electronically. This new system, which significantly reduces the time needed to file Forms 1120 and 990, provides corporations and tax-exempt organizations with the option to transmit tax return data using a secure Internet connection in place of a modem.
According to a statement released by the Internal Revenue Service, taxpayers and tax professionals can prepare the returns using IRS-approved software developed by one of several software companies. In 2003, corporations filed more than 5.7 million corporate income tax returns (Form 1120) and tax-exempt organizations filed 506,000 annual information returns (the Form 990 series), plus 395,000 automatic extension forms. This year, as of the week of April 15, 2004, more than 48.5 million tax returns have been submitted via the Internet.
“E-filing is the fastest, easiest way to do taxes,” said IRS Commissioner Mark W. Everson in a statement. “There are fewer errors, and taxpayers get their refunds in less than half the time of paper returns.”
As it stands this year, 11 million returns were filed to the IRS from home-based computers, an increase of 21.3% from last year, while tax professionals filed more than 34.2 million returns electronically, a 13.7% increase from last year.
2004 Filing Season Statistics
|Individual Income Tax Returns*||2003||2004||% Change|
Current Tax Year Refunds Certified
|Amount of Principal (in billions)||$131.3||$142.540||8.5|
Direct Deposit Refunds
|Amount (in billions)||$86.153||98.128||13.9|
|Average (in thousands)||$2,381||$2,463||3.4|
*In millions to the nearest hundred. Source: Internal Revenue Service.