Free, Cheap Options Available for Minnesotans to E-File Income Tax Returns

ST. PAUL, Minn., March 30 /PRNewswire/ -- With only about two weeks to go before the April 15 tax deadline, nearly half of Minnesotans have not filed their 2004 income tax return yet. If you're one of the procrastinators, and you're looking for a free or low-cost option to file the quick way, the Minnesota Department of Revenue's website features several free and cheap options for electronically preparing and filing your return.

Those who qualify to e-file free are taxpayers who, in 2004, were:
-- 25 or younger,
-- 61 or older,
-- a qualifying taxpayer for the federal Earned Income Tax Credit,
-- an active-duty member of the military, with a W-2 from the military,
or
-- a taxpayer with total household income of $35,500 or less.

You must go to the Revenue Department's website at http://www.taxes.state.mn.us/ to ensure you get the free option from one of these software providers for both federal and Minnesota returns.

E-file benefits

Faster refunds. This year, 98 percent of e-filed state returns received so far have been processed within five days, and often sooner for taxpayers who chose direct deposit. Paper returns generally take about 30 days until April 1, with a longer wait after that.

Easy and accurate. Most software asks questions and uses your answers to fill in the return so you don't have to deal with completing the forms. You enter the information from your tax documents, and it does the preparing and the calculating for you, taking the worry out of doing the math on your own.

File now and pay later if you owe. If you owe tax, you can e-file today and set the payment date for anytime on or before April 15. You can electronically pay your tax -- a quick, paperless transaction.

Reduce the cost of government. E-filed returns cost the government $1.24 to process; paper returns cost $2.97.

Other ways to e-file

If you don't qualify for free e-filing, there are options as low as $5.95 (free for federal, $5.95 for the state return). Go to the Revenue Department's website at http://www.taxes.state.mn.us/ to find software providers that can prepare and transmit both federal and Minnesota returns.

You can also e-file by buying tax preparation software for your computer and transmitting the returns via your internet service, or by asking your tax preparer to e-file for you.

Minnesota no longer offers free telefiling, but if you qualify for free electronic filing, you can electronically file your federal and Minnesota returns online instead. If you telefile your federal return, you'll need to either file your state return on paper or find a link at http://www.taxes.state.mn.us/ to a software product that offers "state-only" filing for a small fee. When filing a "state-only" return, you will need to enter your federal information first so that the software can properly prepare your Minnesota return. If you telefiled your federal return, be sure to e- file only your state return online.

Filing statistics
The Minnesota Department of Revenue:
-- expects about 2.4 million income tax returns this year, and has
received about 1.3 million so far,
-- has a goal of 1.7 million (70 percent) returns being e-filed this
year,
-- has seen an 18 percent increase over the same time last year in the
percentage of taxpayers who filed their own return online,
-- received about 62 percent of returns electronically last year, which
made Minnesota the best in the nation for the percentage of population
that e-filed,
-- has seen tremendous growth in e-filing. The department received fewer
than 3,200 e-filed returns in 1990, the first year it was available,
and about 472,000 in 1998.

Filing requirements

You must file a Minnesota income tax return if you are a Minnesota resident and you are required to file a federal income tax return, or if you are a part-year resident or nonresident of Minnesota and you have a Minnesota gross income of $7,950 or more. Your 2004 Minnesota return must be postmarked by, brought to, or electronically filed with the Department of Revenue no later than April 15, 2005.

Resources

http://www.taxes.state.mn.us/ -- You'll find fact sheets, forms, contact information, answers to frequently asked questions, and a link to Spanish income tax instructions and income tax fact sheets.

Volunteer Income Tax Assistance (VITA) sites -- Free assistance throughout the state for elderly, disabled and low-income taxpayers; call 651-297-3724 or go to the Minnesota Department of Revenue's website at http://www.taxes.state.mn.us/ to find one near you.

The Revenue Department's taxpayer assistance line -- Call 651-296-3781 from 9 a.m. to 5 p.m., Monday through Thursday, and 9 a.m. to noon on Fridays.

Forms -- If you're not e-filing your return and you need forms, download them from the department's website at http://www.taxes.state.mn.us/ . Libraries (or the post office only if your community has no library) also provide them, or you can order through the department's automated phone system at 651-296-4444. Forms ordered through this system generally take about five days to arrive, so the department encourages you download them from its website for faster results -- or better yet, e-file.