I love, love, love computers - but I almost never e-file. Call me old fashioned if you want but I love the thrill of racing to the post office at the stroke of midnight. Okay, maybe not exactly. But when it comes to e-filing, I'm going to say "It depends."

The pros? It's fast. It's convenient. And you have this great sense of accomplishment when you press send that you're all finished - no waiting in the line at the post office.

And yes, you may get your refund faster - generally, about 2-4 weeks faster.

But. And I have a few of these.

I think there are a lot of good tax prep programs out there - but many of the fees that you incur for e-filing can be significant, especially if you have no tax liability to begin with. Why pay money to not pay taxes earlier?

Some folks may not completely understand the consequences of e-filing which can lead to confusion. Make sure that you understand what you're agreeing to pay - both to the taxing authorities and to the tax pros. If you opt to pay directly out of your bank account, make sure that you understand when payment will occur - and whether there are additional fees for paying your taxes online (there usually are).

You should also read the fine print. One of the most confusing aspects of the recent economic stimulus plan was the little advertised fact that paying fees out of your refund (a common occurrence) disqualified you to receive your rebate check via direct deposit. This is because the tax pro acted as a third party in the transaction - and the IRS just sent a regular paper check. This angered a lot of taxpayers (oh trust me, I received a LOT of angry feedback from e-filers who did not understand this to be true).

I have concerns about privacy, too. Some of the information that third parties may receive is pretty personal and I have concerns about what kinds of information companies may share. I'm not worried for identity theft reasons - but more for my own privacy. Should Intuit know exactly how much I make AND how much I spend on child care expenses? Should they be allowed to share this information with Gymboree? I am not convinced based on chatter in the field that, as e-filing explodes, that information will stay private. Third party preparers have already made headway into being allowed to share info... why make it easier?

Yes, a wishy-washy answer. That's because although I often recommend e-filing for some clients, I don't think it's a one-size fits all program yet. Let's hope it continues to get better as more and more taxpayers opt in.

I'm not a tax expert -- I'm the real estate guru -- but I can say that my account has my husband and I e-file because he said it gets us our refund faster.

E-filing definitely has some appealing benefits beyond convenience (although I'm sure it's great to not run to the post office on midnight April 14). I'll probably use it when I file independently for the first time next year.

I found an NPR story from 2006 that explained that filing online reducing errors hugely with checkpoints that will catch a missing SS # or transposed numbers. A different blog post I found mentioned that once you submit online the IRS will contact you within 48 hours if there are any problems.

Also, e-filing allows you to receive your refund faster than usual. If you select direct deposit you'll get it even faster! Lots of people doing that benefited from getting their stimulus checks first this year.

Lastly, if you make less than $50k a year, you can use Free-File on the IRS website. If you make more, it usually costs about $10 - $25 to e-file - then it's up to you to decide if the benefits outweigh the costs.

Here are the links: http://www.npr.org/templates/story/story.php?storyId=5323074
http://www.queercents.com/2007/03/12/money-mondays-benefits-of-e-filing/