The Internal Revenue Service estimates that more than half of the 133 million tax returns that will be filed this year will be filed electronically.
This year is the first time that more than 50 percent of individual taxpayers will have filed by computer or touch-tone phone since electronic filing was permitted in 1986.
Going over the 50 percent mark means the IRS is one step closer to meeting a mandate by Congress to save money by having 80 percent of all returns filed electronically by 2007.
With more than 100 million taxpayers due some kind of refund, it is easy to see why e-filing has grown in popularity:
A taxpayer can choose to have a refund deposited directly to a bank account, which can be done within a week to 10 days.
Receiving a refund from a return filed by mail typically takes four weeks.
But even for those filers not expecting a refund, the IRS urges electronic filing as a way to cut down on errors.
The e-file software developed by the IRS alerts taxpayers to errors before the return is filed, meaning the error rate for a return filed electronically is less than 1 percent, compared with nearly 20 percent for paper returns.
"Our digital products will catch what we'd call dumb mistakes, like you forgot your address or Social Security number, and it will double-check your math," said Tom Linafelt, a spokesman for H&R Block, where 95 percent of all returns done in the company's offices are sent to the IRS electronically.
"The real benefit of these digital solutions is the time they cut from the tax preparation. What we say is that it cuts about 10 hours from what is typically a 12-hour process," he said.
Technology has advanced to such a degree that at least 15 online services help people file electronically for free.
Also, more preparers are offering software to make such filing easier, usually charging a fee for the service.
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