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With tax season approaching, an increasing number of people are planning to file their federal taxes online, according to The Conference Board.

Forty percent plan to file online, up from 34 percent three years ago. More than two-thirds of taxpayers said they have filed online for three years or more, up from 55 percent in 2005.

"Given the many online tax filing alternatives and payment options, such as IRS E-file, Free File and direct deposit options, it's not surprising that every year an increasing number of consumers are filing electronically," says Lynn Franco, Director of The Conference Board Consumer Research Center. "And, once they file online, they tend to stay online." 
 
More people are comfortable filing their taxes online, compared to other financial transactions. The survey found that half are "extremely concerned" when banking or paying bills online, but only 44 percent feel the same way about filing taxes online.

The percentage of Internet users who are filing their federal taxes offline has decreased over the past several years as more people are choosing to file online. The most common reason for not filing online is that people do not prepare their own taxes or they are concerned about sending personal information over the Internet.

Among people who plan on filing their taxes online, over 40 percent will use a professional service, with women more likely than men to use a professional service. The second most popular method favored by one-third of online filers, is do-it-yourself software. Male filers are more likely than female filers to use tax software.