The survey found sixty percent of taxpayers plan to use an accountant or professional tax preparer. The number of taxpayers turning to online tax programs now slightly surpasses those planning to use packaged software with 11 percent saying they will go online compared to 10 percent saying they will buy a packaged program.

Not surprisingly age was a factor in how people will pay their taxes. Online tax preparation is most popular among people 18-34 years of age, where 16 percent plan to use online tax programs and 8 percent packaged software compared to just 2 percent of taxpayers 65 or older using online tax prep and 6 percent using packaged software. Those 65 and older are the most likely to use a professional tax preparer, with 69 percent saying they will do so, compared to just 55 percent of 18-34 year-olds opting for this approach.

"Use of online tax programs is gaining momentum for a number of reasons," said Gary Lundberg, product management director for CompleteTax.

"A generation has now grown up regularly banking and paying bills online, and they are comfortable with the process. Online tax programs, such as CompleteTax, also allow you to try before you buy, making certain the program matches your needs, and offer a version that’s entirely free. So it’s an easy, safe and risk-free way to get your taxes done."

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New York Justice Eileen Bransten wrote in an order released today "there is no basis upon which Amazon can prevail."

The judge said the New York law does not tax "any and all Internet sales," but only requires businesses to collect state and local sales taxes if the company generates $10,000 or more in revenue via affiliate networks.

"The neutral statute simply obligates out-of-state sellers to shoulder their fair share of the tax-collection burden when using New Yorkers to earn profit from other New Yorkers," the judge wrote.

Amazon had argued that since it does not have a physical presence in the state that it should not be required to collect taxes on shipments going to New York. "Amazon has no physical presence in New York," according to the company’s suit. "It does not own, lease, or otherwise occupy any physical property in the state, and none of its employees works or resides in the state."

Amazon had also argued that the New York law is unconstitutional based on a 1992 U.S. Supreme Court ruling that said states are prohibited from requiring out of state retailers to collect tax unless the company had a physical presence in the state.

A similar lawsuit by Overstock.com was also dismissed. Both Amazon and Overstock are expected to appeal the decision.
 

More Americans Filing Taxes Online

According to the Conference Board and TNS dissipating online security concerns have led to more online filing. Just 43 percent of Internet users are "extremely" worried about security risks in filing their taxes online, a decrease from 52 percent in 2004.

Around two-thirds of taxpayers have filed their taxes electronically over the past three years, and half have done so for five years or more.

In 2006, 73 million people filed their taxes online and million filed from their home computers, according to the IRS.

This year 40 percent is expected to file their 2006 federal taxes online, an increase of 28 percent over three years ago. One of the major drivers for filing online is direct deposit of refunds.

"Whether using professional tax services or do-it-yourself software, electronic filing continues to grow year after year. And, by far, direct deposit is the preferred refund method," said Lynn Franco of the Conference Board.

"This year’s ability to split refunds among up to three accounts is yet another choice that should broaden the appeal of electronic filing."

The IRS offers a free online filing system that has had a decrease in use over the past three years because of a drop in the number of people who are eligible to use the system.

Close to 40 percent of consumers who will file online will use a professional tax service with women more likely then men to seek help.

 For consumers who do not file online most do not do their own taxes or they have anxiety about having their information on the Internet.

This years tax deadline is Tuesday April 17.