What is the percentage of people that get their taxes done by tax preparers?

A digital tax-prep tool is the most popular option among tax filers, with more than a third (34.5 percent) of tax filers saying this is the method they use to file taxes. Tax-filing software is a popular option because of the lower costs associated with filing digitally as well as the ease of using a program to automate calculations and deductions. Filing fees typically start as low as $0 or $10 to file federal and state returns using a basic 1040 form. The IRS also offers a free tax filing service called Free File, which is available to taxpayers who make $62,000 or less annually.

But hiring an accountant to file taxes is almost as common an option, with 28.5 percent of people saying they prefer this method for filing taxes. Another 8.3 percent choose to file with the help of brick-and-mortar tax companies like H&R Block. When you add these two groups together, you can see that 36.8 percent of Americans prefer to hire a tax preparer to file their returns.

A professionally prepared tax return comes at a premium, however; the average fee charged by tax preparers was $273 in 2015, according to data from the National Society of Accountants.

Another 10.9 percent of taxpayers choose to have family member or friend handle their filing, likely getting this help for free or for a very low cost. However, there’s more room for error if you choose to go this route and have your taxes filed by a nonprofessional. 

About 8.5 percent of tax filers are surprisingly still using the pen-and-paper method. But there’s a major drawback to doing taxes by hand: you’re much more likely to make an error in your calculations. Still, the big benefit of filing taxes by hand is that it can be much cheaper since most IRS tax forms can be picked up for free at many libraries and post offices.

Lastly, there is about 9.2 percent who said they don’t file taxes. Some of these respondents could be in the group of Americans who won’t be required to file a tax return for last year. Also in this group could be some of the 7 million taxpayers who are required to file a return but fail to do so, according to Forbes.

Marlon JacksonComment