This is ideal for a young person with a very simple financial situation. If you give them a phone, they'll file by phone. One problem that the IRS has not entirely worked out is the need for a signature to validate the return. Growing use of electronics is good news for the IRS and the government in general. Congress wants 80 percent of tax returns filed electronically by 2007, and the IRS would like nothing better.
Electronic returns are easier to process and contain far fewer errors.
Computers and the Internet have other benefits as well. Tax professionals, who have been using computers for years to prepare clients' returns, say there are advantages for them as well from the spread of tax-preparation software for home computers. While some privately express worry that they may lose clients, many say computers are helping taxpayers keep complete and accurate records, freeing the professionals to concentrate on the real tax issues. There are a number of people who will make a first draft on their own and then bring it in. For example, most programs will not let you take a credit you are not eligible for, and some of the software notes when a particular deduction is much higher than is normal for people in your income bracket.