Indiana to stop mailing out state income tax forms

Indiana residents won't receive their state income tax forms in the mail in 2011, but most of them probably wouldn't have filed their taxes on paper anyway, a state tax official said Wednesday.

State Department of Revenue spokeswoman Stephanie McFarland said at a news conference that the tax agency decided not to mail out the booklets because as many as two-thirds of Indiana residents now file their taxes electronically.

The number of people who file using income tax software or other electronic methods has surged in recent years. Five years ago, about one-third of Indiana's taxpayers used electronic filing, McFarland said.

She said the agency estimates the change will affect about 1 million taxpayers and save the state about $200,000 in the next fiscal year.

As for those who don't want to trust their taxes to their computer, don't worry — McFarland said the forms will still be available at public libraries and the agency's 12 district offices. They also can be downloaded and printed from the agency's website.

"There's too many other ways for people to get those," she said.

The state tax agency will send postcards announcing the change to people who it expects to file on paper, she said.

Indiana's decision to stop mailing tax forms in 2011 follows the Internal Revenue Service's announcement in September that it was no longer mailing tax forms because so many people file their federal returns online.

Eliminating mailing out tax forms is just one of a handful of changes affecting Indiana taxpayers this coming tax season.

The Department of Revenue is urging people who plan to claim tax credits to file early or electronically because the General Assembly capped those benefits in the biennial budget. For example, McFarland said, the pool for Energy Star tax credits is capped at $1 million, and once that money is gone, no more credits will be issued.

The caps also affect the state scholarship tax credit, which is limited to $2.5 million, and a teacher summer employment credit that is capped at $500,000, she said.

McFarland said filing electronically would put taxpayers in line for the credits quicker, since those returns are processed immediately and paper returns can take days.

She also warned taxpayers who file by mail to check with the post office to make sure they include their proper address on their envelope, since she said the U.S. Postal Service plans to strictly enforce standard addressing and may not deliver mail that bears the wrong address.

And taxpayers get a bit of a break this year — the deadline to file state and federal taxes is April 18 rather than April 15, because April 15 falls on a holiday in Washington.