The Internal Revenue Service spends millions to process paper tax returns. And the American public still does not get it that it saves money for everyone to file tax returns online. Nearly 43 percent of individual income tax returns filed in 2008--or 66.4 million--were paper. That cost the IRS nearly $191 million in processing fees, according to the Treasury Department's inspector general.

The cost of processing a single paper-filed tax return is nearly $3, compared to 35-cents for an e-filed return.

So what's the IRS waiting for? Why hasn't it launched a massive campaign turn the paper-filers into electronic ones? The IG said it's time for the IRS to pursue a mandate for paid preparers to e-file individual income tax returns.

"Most paid preparers who filed paper tax returns actually used an electronic tax software preparation package and 70 percent also e-filed at least one tax return, which indicates a familiarity with the electronic preparation and e-filing process," the IG said. "However, while paid preparers are willing to e-file returns, some taxpayers are reluctant to do so."

For more on the sorry state of the IRS e-filing program:
- check out this nextgov.com article

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