The Use of Technology in Tax Preparation: A Closer Examination of Electronic Filing and Filing Errors

• Date: 01 March 2017
• DOI: http://doi.org/10.1002/jcaf.22258
• Published date: 01 March 2017
• Author: Jeffrey Limato,Bea Chiang

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© 2017 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com).

DOI 10.1002/jcaf.22258

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The Use of Technology in Tax

Preparation: A Closer Examination

of Electronic Filing and Filing Errors

Bea Chiang and Jeffrey Limato

INTRODUCTION

In the past

decade, innovative

tax software has been

developed that has

revolutionized what

the United States

has known as “filing

season.” Software

that has allowed paid

preparers to increase

their productivity sig-

nificantly in addition

to the contemporary

phenomenon of filing

taxes online all repre-

sent the ways in which

tax preparation has

advanced. No longer is

there the need to bring

a binder of innumer-

able forms to the local

CPA. Instead, tax pre-

parers now have the

ability to prepare taxes

from the comfort of

one’s home.

Not only has

there been an abun-

dance of tax soft-

ware developed by

big corporations,

the Internal Rev-

enue Service has

also modernized its

Taxpayer Assistance

Programs, offering

assistance to taxpay-

ers. If someone has

an inquiry about

a tax matter, they

can either walk into

one of the IRS Tax-

payer Assistance

Centers or utilize

one of theironline

services. A plethora

of resources are now

available to taxpayers

seeking assistance.

Given the advent

and modernization

of tax prepara-

tion software and

the IRS’s Taxpayer

Historically, individuals have called upon certi-

fied public accountants for their tax preparation

services; however, with the implementation of

new technologies and resources, there has been

a change in the way tax preparation is performed

in the United States. The purpose of this article is

to explore how the Internal Revenue Service’s Tax-

payer Assistance and Education Programs have

evolved over time. Additionally, the advent of

electronic return filing (e-filing) will be reviewed,

to see if e-filing has increased the propensity

for individuals to file their returns electronically

and whether filing errors have been reduced by

electronic filings over the years. After analyzing

data from the IRS Data Book and Filing Season

Statistics, the results indicate that despite an

increasing trend in the use of technology in the

IRS’s Taxpayer Assistance Programs, in addition to

an increasing trend in the propensity for taxpayers

to file their individual income tax returns electroni-

cally, no increase or decrease in mathematical

errors on individual income tax returns has been

identified by the IRS. © 2017 Wiley Periodicals, Inc.

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