What's Up With E-Filing?

Those of you who know me well knew this one must be coming. I just filed my taxes. This year we used TurboTax instead of the TaxCut product we'd used in previous years. (In my opinion, the cheapest one is the best one.) Every year around this time I marvel at how oligopolies work so well. First, a not-so-fake analogy. Why, when you try to buy tickets online at places like Ticketmaster, do you have to pay a "convenience" fee that ultimately increases the price of your tickets up to 20%? This so-called convenience fee is presumably for the privilege of buying stuff online in my underwear and not having to go to the grocery store to wait in line and buy tickets (where you'd then pay a service fee instead). However, the real convenience, we all know, is for our good friends at Ticketmaster, since they can fire 25% of their people now that we all use the Internet. Therefore, I'm paying them extra to do something that's more efficient for them, and thus making them more money anyway. Sweet deal!

Fast forward to taxes. Why must I pay a fee in order to pay my taxes electronically? Come on, how absurd! For the luxury of being lower on the IRS' audit totem-pole, I have to pay (this year) $17.95, complements of my other close friends at Intuit. Of course, they know that because I'm getting a nice whopping refund I'll glady pay their extortion. Who wouldn't? No one wants to wait 3 months or whatever it is to get the paper refund. Not to mention that if I send it in by hand, some IRS lackey will have to scan or re-enter all the fields into some computer, thereby exposing me to calculation errors and higher chances of audit.

Side Rant

Oh, and have you noticed how each year the price on the tax software continues to go up? Used to be you could get the software plus a rebate, plus free e-filing, for $25-30. Now you'll pay quite a bit more. Could that be, oh, say, because we're all locked into using it and no one in their right mind would go back to filling out the myriad forms by hand?! Next year my bet is $50 base price, plus another $20 to eFile. There, now I feel better.


By the way, you can do a free e-file if you live in Colorado at https://www.netfile.state.co.us. I always do that instead of paying those extortioners twice at the tax companies.

So essentially, in order to be more efficient and cost the IRS less, I get to pay more. Don't you just LOVE capitalism. I have to go now, and wait for my direct-deposit transfer...

Comments

alison said…
i keep seeing a commercial that features free online tax software/prep/filing. of course can't remember the website now.
of course you know that the whole american economy would come to a grinding halt w/o ticketmaster! :)
Brett said…
Chris, deep down inside, I think you are just jealous that you didn't come up with the idea first.

Maybe we should pool our tax returns and start a company that adds convenience fees to cool "must have" product.
Ryan said…
I miss the Colorado State e-filing. It was easy and free. Last year I figured I would try the same thing for Kentucky. It turns out the Kentucky forms are worse than the Federal forms. I ended up paying for the state version to simplify filing.

And don't even get me started on paying taxes on last years state tax refund....
Mia said…
Always appreciate a good rant. We still go with the super cheap tax software... actually I leave it all to Forrest so the fees don't really bother me that much, but maybe if I was in charge it would.
Erica said…
Really- you make me laugh. This is why America is so great. We pay to get our money!

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