SOI -278 - IRS Individual Taxpayer Burden Survey; SOI-279 - Employee Plan Voluntary Compliance Customers; SOI-280 - Evaluation of the “I Take Credit” EITC Marketing Campaign

Individual Taxpayer Burden Study Draft W&I and SE Questionnaire

Individual Taxpayer Questionnaire (W&I and SE)

CATI Version

INTRODUCTION

Hello, may I please speak with [Respondent’s name(s)].

My name is _________ and I am calling from the IBM Survey Research Center to follow up on a letter we sent you recently. We are conducting a study for the Internal Revenue Service to understand the time and money taxpayers spend to comply with federal tax laws, rules, and regulations.

Please be assured that I will not be asking about your income or other financial details of your return. Your responses will be used by IRS only for research purposes.

The Paperwork Reduction Act requires that the IRS provide an OMB control number on all public information requests. The OMB Control Number for this study is XXXX-XXXX. If you have any comments regarding this study or suggestions on making this process simpler, I can provide an address to which you may write. Please note that your participation in this survey is voluntary. As a token of our appreciation, we will send you $XX.00 upon completion of the interview.

PROMPT, READ ONLY IF NECESSARY: Please be assured that your responses will not be used for any current or future enforcement activities.

PROMPT, READ ONLY IF NECESSARY: Internal Revenue Service, Tax Products Coordinating Committee, SE:W:CAR:MP:T:T:SP, 1111 Constitution Ave. NW, Washington, DC 20224.

PROMPT, READ ONLY IF NECESSARY: The IRS commissioned us to conduct this study to provide Congress and the President with accurate estimates of the time and money taxpayers spend complying with federal income tax laws, rules, and regulations. The interview will take about 20 minutes.

SCREENER

Your federal income tax return refers to Form 1040, 1040A, 1040EZ, as well as associated forms and schedules, which are used to report the income you have received to the IRS.

1. Approximately how many years have you been filing a federal income tax return?

1. 1-5 years

2. 6-10 years

3. 11-20 years

4. Over 20 years

8 DON’T KNOW

9 REFUSED

2. Did you file a 2007 federal income tax return for income received between January 1 and December 31, 2007?

1 YES

2 NO {SKIP TO Q7}

3 DO NOT NEED TO FILE FOR TAX YEAR 2007 {TERMINATE INTERVIEW}

8 DON’T KNOW {TERMINATE INTERVIEW}

9 REFUSED {TERMINATE INTERVIEW}

[For this study we are only interviewing taxpayers who have submitted a 2007 federal income tax return. Thank you for your time. {If Q2=3}]

3. Did you file a joint return for your 2007 federal income tax return?

1. YES

2. NO {SKIP TO Q6}

3. DO NOT NEED TO FILE FOR TAX YEAR 2007 {TERMINATE INTERVIEW}

4. DID NOT FILE YET {SKIP TO Q7}

8 DON’T KNOW {SKIP TO Q6}

9 REFUSED {SKIP TO Q6}

[For this study we are only interviewing taxpayers who have submitted a 2007 federal income tax return. Thank you for your time. {If Q3=3}] {TERMINATE INTERVIEW}

4. Between you and your spouse, who was primarily responsible for preparing and completing your 2007 federal income tax return?

1. RESPONDENT {SKIP TO Q6}

2. SPOUSE

8. DON’T KNOW {SKIP TO Q6}

9. REFUSED {SKIP TO Q6}

5. May I please speak with your spouse?

1. YES {Continue with Spouse; Reread Intro Except for First Sentence; SKIP TO Q6}

2. NO {Collect Name; Find Out When to Call Back}

8 DON’T KNOW {Collect Name; Find Out When to Call Back}

9 REFUSED {Thank Respondent; Set for a Call Back}

6. When did you file your 2007 federal income tax return?

1. Before or on April 16^th, 2008 {SKIP TO Q8}

2. After April 16^th, 2008 {SKIP TO Q7}

3. RESPONDENT HAS NOT YET FILED THEIR 2007 FEDERAL INCOME TAX RETURN {SKIP TO Q7}

4. DO NOT NEED TO FILE THIS YEAR {TERMINATE INTERVIEW}

8 DON’T KNOW {Thank Respondent; Set for a Callback}

9 REFUSED {Thank Respondent; Set for a Callback}

[For this study we are only interviewing taxpayers who have submitted a 2007 federal income tax return. Thank you for your time. {If Q6=4}] {TERMINATE INTERVIEW}

7. Taxpayers can receive an automatic 6-month time extension if they are unable to file their federal individual income tax returns by the due date. Did you file for an extension?

1. YES {If Q6=2, SKIP TO Q8}{If Q2=2 OR Q6=3 or Q3=4, Thank Respondent; Set for a Callback after October 15^th}

2. NO {If Q6=2, SKIP TO Q8}{If Q2=2 OR Q6=3 or Q3=4, Thank Respondent; Set for a Callback}

8 DON’T KNOW {If Q2=2 OR Q6=3 or Q3=4, Thank Respondent; Set for a Callback; Otherwise, SKIP TO Q8}

9 REFUSED {If Q2=2 OR Q6=3 or Q3=4, Thank Respondent; Set for a Callback; Otherwise, SKIP TO Q8}

Schedule C and Schedule C-EZ are for reporting profit or loss from a sole proprietorship business.

8. For tax year 2007, did you report profit or loss from a sole proprietorship business?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

Schedule E is for reporting income or loss from rental real estate, royalties, partnerships, S corporations, estates, or trusts.

9. For tax year 2007, did you report income or loss from rental real estate, royalties, partnerships, S corporations, estates, or trusts?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

Schedule F is for reporting profit or loss from a farming business.

10. For tax year 2007, did you report profit or loss from a farming business?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

Form 2106 is for reporting employee business expenses that were not reimbursed or only partially reimbursed by your employer, such as teaching supplies, lodging, airfare, or car rental.

11. For tax year 2007, did you report employee business expenses that were not reimbursed or only partially reimbursed by your employer?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

12. Did you report any business employees working for you on your 2007 federal income tax return? Please do not include household employees. {IF Q8=1 OR Q10=1}

1. YES

2. NO

8 DON’T KNOW

9. REFUSED

Your 2007 federal income tax return includes a Form 1040, 1040A, or 1040EZ, along with any associated forms and schedules. Some taxpayers use several methods to prepare their tax returns.

13. Which of the following method or methods did you use to prepare your 2007 federal income tax return?

PROMPT, READ ONLY IF NECESSARY: Tax preparation software includes TurboTax, TaxCut, TaxACT, Tax Brain, Complete Tax, and EZ Tax Refunds.

PROMPT, READ ONLY IF NECESSARY: IRS sponsored programs include IRS Walk-in sites, Volunteer Income Tax Assistance (VITA), and Tax Counseling for the Elderly (TCE).

{Select all that apply}

1. Use tax preparation software that you installed on your computer

2. Use tax preparation software that you accessed through an internet website

3. Use a paid professional, such as a financial planner, tax preparer, tax practitioner, or accountant

4 Use friends, family members, or employees

5 Use an IRS sponsored walk-in site such as VITA or TCE

6. Use the fill in PDF version of the tax forms and schedules

7. Use the paper version of the tax forms and schedules

8 OTHER [Please record if volunteered]

9 DON'T KNOW

10 REFUSED

14. Of these, which one best describes the primary method you used to prepare your 2007 federal income tax return?

{Select only one}

1. Used tax preparation software that you installed on your computer

2. Used tax preparation software that you accessed through an internet website

3. Used a paid professional, such as a financial planner, tax preparer, tax practitioner, or accountant

4. Used friends, family members, or employees

5. Use an IRS sponsored walk-in site such as VITA or TCE

6 Use the fill in PDF version of the tax forms and schedules

7 Used the paper versions of the tax forms and schedules

8 OTHER [Please record if volunteered]

9 DON'T KNOW

10 REFUSED

15. Which of the following tax preparation software packages did you use to prepare your 2007 federal income tax return? {If Q13=1 or Q13=2}

{Select only one}

1 TurboTax

2 TaxCut

3 TaxAct

4 Tax Brain

5 Complete Tax

6 EZ Tax Refunds

7 Other [Please record if volunteered]

8 DON’T KNOW

9 REFUSED

For the remainder of the interview, I will ask you about different types of activities related to your 2007 federal income tax return, such as record keeping, gathering tax materials, tax planning, form completion and form submission, as well as any work you may have done with a paid professional. We will then ask you to estimate the total time you spent for each of these activities. We will also ask you to estimate any out of pocket fees you may have incurred related to your 2007 federal income tax return.

Throughout the interview, please do not include state or local income tax obligations, payroll taxes, or activities related to helping anyone else with his or her federal income tax return.

[Also, do not include any activities you completed for Form 1041 for estates and trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations. {If Q9=1}]

RECORDKEEPING TIME

Record keeping includes documents that you, [your spouse, {If Q3=1}], [your business employees {If Q12=1}], a friend or relative maintained for your 2007 federal income tax return.

16. How did you record or organize the documents you needed to complete your tax return?

A. Filed records in a cabinet, drawer, shoebox, or other form of storage?

1. YES

2. NO

8 DON’T KNOW

9 REFUSED

B. Recorded information in a non-computer based system, such as a ledger or notebook?

1. YES

2. NO

8 DON’T KNOW

9 REFUSED

C. Recorded information in a computer based system, such as a spreadsheet, Quicken, MSN Money, or QuickBooks?

1. YES

2. NO

8 DON’T KNOW

9 REFUSED

D. Gave records to a paid professional? {If Q13=3}

1. YES

2. NO

8 DON’T KNOW

9 REFUSED

E. Were there any other methods that you used for recording or organizing documents?

1. YES {Please record}

2. NO OTHER METHODS

8 DON’T KNOW

9 REFUSED

Q16 Recode (Q16rec)

1. Tax Prep Package

2. Bills/Receipts

3. Checkbook

4. Planner (PDA)

5. Paper and Pencil

17. How many W-2 forms, if any, did you receive for your 2007 federal income tax return?

PROMPT, READ ONLY IF NECESSARY: W-2 forms are statements of wages and income that are provided by employers to document your wages and income.

_______Enter Number of W-2(s)

RANGE [0-25] DK, RF

Form 1099 is for reporting interest income from a bank, dividends on stocks, Social Security income, statements from brokers on sales of stocks or bonds, or income earned as a subcontractor. Form 1098 is for reporting mortgage interest paid or student loan interest paid.

18. How many 1099’s, 1098’s or other information returns (for example, K-1’s or 1065-B’s), if any, did you receive for your 2007 federal income tax return?

_______Enter Number of 1099(s), 1098(s), and Other Information Returns

RANGE [0-25] DK, RF

19. Did you have to make a special effort, beyond what you expected, to obtain or correct your W-2s or other information returns? By special effort, we mean anything other than receiving these forms in the mail or downloading them from an employer’s or financial institution’s website. {If Q17>0 or Q18>0}

1. YES

2. NO

8 DON’T KNOW

9 REFUSED

For the next series of questions, please tell me whether you maintained documentation for tax purposes regardless of whether you used it when completing your tax return.

20. Did you maintain documentation for any of the following tax-related expenses?

{Rotate Q20A – Q20H}

A. For Medical or Dental expenses?

1. YES

2. NO

3. NOT APPLICABLE

8. DON’T KNOW

9. REFUSED

B. For Dependent Care expenses?

1. YES

2. NO

3. NOT APPLICABLE

8. DON’T KNOW

9. REFUSED

C. For Home Office expenses?

1. YES

2. NO

3. NOT APPLICABLE

8 DON’T KNOW

9. REFUSED

D. For Household Employee Expenses?

PROMPT, READ ONLY IF NECESSARY: Household Employment Taxes are for individuals who work in your home who are not independent contractors and who are not employed by an agency that directs their work. Some examples of household employees are nannies and housekeepers.

1. YES

2. NO

3. NOT APPLICABLE

8. DON’T KNOW

9. REFUSED

E. For Education Expenses?

PROMPT, READ ONLY IF NECESSARY: Education expense includes tuition, fees and interest.

1. YES

2. NO

3. NOT APPLICABLE

6. DON’T KNOW

7. REFUSED

F. For cash donations to a charity?

1. YES

2. NO

3. NOT APPLICABLE

8 DON’T KNOW

9 REFUSED

G. For non-cash donations to a charity?

1. YES

2. NO

3. NOT APPLICABLE

8 DON’T KNOW

9 REFUSED

H. For miscellaneous tax related expenses?

1. YES

2. NO

3. NOT APPLICABLE

8. DON’T KNOW

9. REFUSED

{If Q20A1 AND Q20B1 AND Q20C0 AND Q20D0 AND Q20E1 AND Q20F1, AND Q20G1, AND Q20H1 then SKIP TO Q22}

21. Did you have to make a special effort, beyond what you expected, to obtain any of this documentation? By special effort, we mean activities such as calling or writing a letter to get a receipt or other form of documentation.

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

22. Did you maintain records for a vehicle that you used for business, charitable, or medical use?

1. YES

2. NO

8 DON’T KNOW

9 REFUSED

23. Did you organize and compile your records before giving them to your paid professional or before preparing your return yourself?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

24. Thinking about all the documents you maintained for your 2007 federal income tax return, did you maintain all of these documents exclusively for tax purposes or were there other personal or business reasons to keep some of them?

PROMPT, READ ONLY IF NECESSARY: Additional reasons might include billing, insurance, legal, inventory, or profits and losses.

1 Exclusively for tax purposes

2 Additional personal or business reasons

3 Did not maintain documentation

8 DON’T KNOW

9 REFUSED

Please think about the total time spent on record keeping activities needed for your 2007 federal income tax return.

Include any time spent:

• retrieving, organizing, and maintaining your tax related records

Do not include any time spent on:

• state or local income taxes

• Form 1041 for estates and trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations {If Q9=1}

• payroll taxes {If Q12=1}

• non tax business or personal record keeping

• anyone else’s federal income tax return

• activities other than record keeping

25. How much time did you, [your spouse, {If Q3=1}], [your business employees {If Q12 =1}], friends and relatives spend on your 2007 federal income tax record keeping activities?

Hours Minutes

RANGE [0-999] DK, RF, EX RANGE [0-59] DK, RF, EX

{If answer to Q25 is greater than 99 hours, a verification screen will appear}

{If interviewer enters ‘999’ hours or ‘EX’, a display screen will appear to remind interviewers to complete a Comment Sheet}

GATHERING TAX MATERIALS TIME

Now let's talk about the forms, software, and other materials you, [your spouse, {If Q3=1}] [your business employees {If Q12 =1}], friends or relatives gathered for your 2007 federal income tax return or for tax planning.

26. In which of the following ways did you receive the forms and publications that you needed to complete your 2007 federal income tax return?

{Select all that apply}

1. From your tax preparation software, a paid preparer, or in the mail from the IRS

2. From an IRS sponsored walk-in site, such as VITA or TCE

3. From the library, bank, post office, or another location

4. From the IRS Website

5. From the IRS by fax, mail, or telephone

27. Did you obtain books or guides [other than your tax preparation software {If Q13=1 or Q13 =2}] that were not IRS publications?

PROMPT, READ ONLY IF NECESSARY: For example, Tax Guide for Dummies or the J.K. Lasser’s Tax Guide.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

Think about the total time spent gathering the materials, forms, publications [and {If Q131 or Q13 ≠2} books [and tax preparation software {If Q13=1 or Q13=2}] needed for your 2007 federal income tax return.

Include any time spent on:

• selecting a paid professional {IF Q13=3}

• purchasing and installing software {IF Q13=1 OR Q13=2}

• setting up and performing initial software updates {IF Q13=1 OR Q13=2}

Do not include any time spent on:

• state or local income taxes

• Form 1041 for estates and trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations {If Q9=1}

• payroll taxes {IF Q12=1}

• activities other than gathering materials

28. How much time did you, [your spouse, {IF Q3=1}], [your business employees {IF Q12=1}], friends, or relatives spend gathering these materials?

Hours Minutes

RANGE [0-99] DK, RF, EX RANGE [0-59] DK, RF, EX

TAX PLANNING TIME

Now let’s discuss tax planning activities that you, [your spouse, {IF Q3=1}], [your business employees {IF Q12=1}], friends or relatives may have done over the past year for your 2007 federal tax return.

29. At any time during the year 2007, did you [or your spouse {IF Q3=1}] submit a W-4 form?

PROMPT, READ ONLY IF NECESSARY: Form W-4 is used to determine or change the amount of income tax your employer withholds from your pay.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

30. Did you [or your spouse, {If Q3=1}] consider the tax implications for any of the following activities?

A. Participating in or maintaining a retirement account or plan such as a 401(k), IRA (Roth, Traditional, Simple), Keogh, SEP-IRA, Defined Benefit, or Defined Contribution Plan?

PROMPT, READ ONLY IF NECESSARY:

Keoghs and SEP-IRAs, (simplified employee pension plan), are tax-deferred retirement savings plans for self-employed taxpayers. A self-employed individual may contribute a maximum of $30,000 to a Keogh plan each year, and deduct that amount from taxable income.

A defined benefit plan is one in which the benefits are first "defined" and the annual employer contributions needed to provide these benefits are then determined. A defined benefit plan is set up to provide a predetermined retirement benefit to employees or their beneficiaries, either in the form of a certain dollar amount or a specific percentage of compensation.

In a defined contribution plan, an individual retirement account is set up for each participating employee who has the freedom to invest his/her contributions among the available investment options. An employee’s benefits are based on the amounts contributed to the account and the investment gains or losses on those accumulated contributions.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

B. Investing in tax-exempt or tax preferred investments that are not retirement accounts or plans?

PROMPT, READ ONLY IF NECESSARY:

Tax-exempt investments include municipal bonds which are securities that offer investors benefits in return for their financial support of public purposes, or certain private projects funded through public entities.

Tax-preferred investments are personalized savings plans, in which the investor does not pay immediate taxes on any investment earnings or gains that enable the savings to grow over time.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

C. Exercising stock options?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

D. Purchasing new equipment or supplies for a business? {IF Q8=1 OR Q10=1}

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

E. Realizing capital gains or capital losses on any investments?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

31. In the past year, did you [or your spouse {IF Q3=1}] attend any classes, seminars, or workshops primarily for tax planning purposes?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

32. In the past year, did you consult a paid professional in order to consider the tax implications of any of the following activities? {IF Q13=3}

A. Structuring your business? {IF Q8=1 OR Q9=1 OR Q10=1}

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

B. Investing?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

C. Calculating tax withholding?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

D. Preparing estimated taxes?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

E. Claiming income deductions or credits?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

F. Any other tax planning services?

1. YES {SKIP TO Q32G}

2. NO {SKIP TO Q33}

8. DON’T KNOW {SKIP TO Q33}

9. REFUSED {SKIP TO Q33}

G. What other tax planning services did you receive? {Please record}

Q32 Recode (Q32rec)

1. Tax Prep

2. Estate

3. Tax Planning Other

4. Retirement

5. Capital Gains/Losses

{Rotate Q33A-Q33D}

33. Did you use any of the following IRS services for tax planning purposes?

A. Called the Toll Free Tax Assistance line to speak with an IRS representative?

1. YES

2. NO

3. NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

B. Visited an IRS Walk-in site, a Volunteer Income Tax Assistance (VITA) site, or a Tax Counseling for the Elderly (TCE) site?

1. YES

2. NO

3. NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

C. Visited the IRS website, excluding for downloading forms, instructions, or publications?

1. YES

2. NO

3. NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

D. Called the IRS Tele-Tax phone line to hear a pre-recorded message?

1. YES

2. NO

3. NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

Think about the total time spent on tax planning over the past year for your 2007 federal income tax return.

Include any time spent:

• reviewing books or publications or conducting other tax planning research

• attending classes or seminars {IF Q31=1}

• doing business tax planning related to your personal tax situation {Q8=1 OR Q9=1 OR Q10=1}

Do not include any time spent on:

• tax planning services with a paid professional

• financial planning that is not tax-related

• state or local income taxes

• Form 1041 for estates and trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations {IF Q9=1}

• payroll taxes {IF Q12=1}

• activities other than tax planning

34. How much time did you, [your spouse, {IF Q3=1}], [your business employees {IF Q12=1}], friends, or relatives spend on tax planning over the past year for your 2007 federal income tax?

Hours Minutes

RANGE [0-99] DK, RF, EX RANGE [0-59] DK, RF, EX

FORM COMPLETION TIME

Now, let’s discuss completing your 2007 federal income tax return, including reviewing and checking your return. [Please remember this does not include any activities you completed for corporate, S-corporate, partnership, estate, or trust federal tax returns {IF Q9=1}]

35. Which of the following best describes the way you completed your 2007 federal income tax return?

{IF Q13=6 OR Q13=7}

{Select only one}

1. Read most or all instructions before starting to complete your return

2. Consulted instructions as needed while completing your return

3. Did not consult instructions

4. DON’T KNOW

5. REFUSED

36. Which of the following best describes the way you completed your 2007 federal income tax return using your tax preparation software, installed or online? {IF Q13=1 OR Q13=2}

1. Followed the entire step-by-step computer-guided interview

2. Selectively used the step-by-step computer-guided interview to address specific tax areas

3. Directly entered information into the tax forms without using the step-by-step computer-guided interview

8 DON’T KNOW

9 REFUSED

37. Did you electronically import or download any of the following information into your 2007 tax preparation software? {IF Q13=1 OR Q13 =2}

A. Data from last year’s tax preparation software to this year’s?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

B. Data from an accounting software package, such as Quicken, MSN Money, or QuickBooks?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

C. Your W-2’s?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

D. Your 1098 Forms, 1099 Forms, or Other Information Returns?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

38. Did you have to make a special effort, beyond what you expected, to import or download any information into your 2007 tax preparation software? {IF Q13=1 OR Q13=2}

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

39. Did you complete a Form 4868 to request an extension for your 2007 federal income tax return?

{IF Q6 = 1}

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

40. Did you pay quarterly estimated taxes between April of 2007 and January of 2008?

PROMPT, READ ONLY IF NECESSARY: Estimated taxes are used to pay taxes on income that is not subject to withholding, or on income where the taxes being withheld are not enough.

1 YES

2 NO {IF Q13=3 AND Q131 AND Q132 AND Q134 AND Q135, SKIP TO Q42}

8 DON’T KNOW {IF Q13=3 AND Q131 AND Q132 AND Q134 AND Q135, SKIP TO Q42}

9 REFUSED {IF Q13=3 AND Q131 AND Q132 AND Q134 AND Q135, SKIP TO Q42}

41. Did you spend any time recalculating the amount of estimated taxes you paid based on changes in your income?

1. YES

2. NO

8. DON’T KNOW

9. REFUSED

42. Did you interact with a paid professional on any of the following activities related to your 2007 federal income tax return? {IF Q13=3}

1. Completing a tax questionnaire or worksheet for a paid professional?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

B. Delivering records to a paid professional ?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

C. Attending meetings with a paid professional?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

D. Completing your tax forms with a paid professional?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

E. Reviewing your tax return with a paid professional?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

43. Did you, [your spouse {IF Q3=1},] [your business employees {IF Q12=1}], a friend or relative on your behalf, spend time considering certain tax provisions before realizing you did not need to report on them?

1. YES

2. NO {SKIP TO Q45}

8. DON’T KNOW {SKIP TO Q45}

9. REFUSED {SKIP TO Q45}

44. Which of the following tax provisions did you spend time on before realizing you did not need to report on them?

A. Unreimbursed Business Expenses?

PROMPT, READ ONLY IF NECESSARY: Employees can deduct ordinary and necessary expenses for their jobs that were not reimbursed by their employers.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

B. Quarterly Estimated Taxes?

PROMPT, READ ONLY IF NECESSARY: Estimated tax is the method used to pay tax on income that is not subject to withholding (for example, earnings from self-employment, interest, dividends, rents, alimony, etc.).

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

C. Depreciation or Amortization?

PROMPT, READ ONLY IF NECESSARY: Taxpayers can claim a deduction for depreciation and amortization, expense certain tangible property, and provide information on the business/investment use of automobiles and other listed property.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

D. Earned Income Tax Credit?

PROMPT, READ ONLY IF NECESSARY: The Earned Income Tax Credit (EIC) entitles certain low-income workers to a tax credit based on their earned income.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

E. Alternative Minimum Tax?

PROMPT, READ ONLY IF NECESSARY: Taxpayers who benefit from special deductions and credits in the tax law may have to pay at least a minimum amount of tax through the Alternative Minimum Tax (AMT).

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

F. Itemized Deductions?

PROMPT, READ ONLY IF NECESSARY: Taxpayers can determine the amount of itemized deductions that they may claim.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

G. Child Tax Credit or Additional Child Tax Credit?

PROMPT, READ ONLY IF NECESSARY: With the Child Tax Credit, taxpayers may be able to reduce their federal income tax by up to $1,000 for each qualifying child under the age of 17.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

H. Credit for the Elderly or the Disabled?

PROMPT, READ ONLY IF NECESSARY: You may be able to take this credit if you were age 65 or older, or you were under age 65, you were retired on permanent and total disability, and you received taxable disability income.

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

I. Was there another tax provision you spent time on before realizing you did not need to report on it?

1 YES {Please ask respondent to specify the other TAX PROVISION That wAS not REPORted and then record}

2 NO

8 DON’T KNOW

9 REFUSED

Q44 Recode (44rec)

1. Capitals Gains/Losses

2. Profit & Loss

3. Child Care/Dependent Expenses

4. Schedule B

5. Schedule C

6. Self Employed Forms

7. Education Credit

8. SCHEDULE H

{Rotate Q45A-Q45D}

45. Did you use any of the following IRS services for tax return preparation purposes?

A. Called the Toll Free Tax Assistance line to speak with an IRS representative?

1 YES

2 NO

3 NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

B. Visited an IRS Walk-in site?

1 YES

2 NO

3 NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

C. Visited the IRS website, excluding for downloading forms, instructions, or publications?

1 YES

2 NO

3 NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

D. Called the IRS Tele-Tax phone line to hear a pre-recorded message?

1. YES

2. NO

3. NEVER HEARD OF THIS IRS SERVICE

8 DON’T KNOW

9 REFUSED

46. For your tax preparation software, installed or online, did you access any of the following features while completing your 2007 federal income tax return? {IF Q13=1 OR Q13=2}

{Select all that apply}

1. Access IRS publications

2. Access third party publications, such as information from J.K. Lasser’s Tax Guide

3. Reference income tax handbook

4. View your tax data

5. Perform final review

6. Review your tax history

7. View tax summary report

8. DON’T KNOW

9. REFUSED

47. For your tax preparation software, installed or online, did you use any of the following help options to complete your 2007 federal income tax return? {IF Q13=1 OR Q13=2}

{Select all that apply}

1. What’s new feature

2. Tax topic videos

3. Troubleshooting tax tips

4. Live tax advice

5. Deductions maximizer

6. Highlighted text link

7. Guide me button link

8. Email questions to tax preparation software vendor

9. DON’T KNOW

10. REFUSED

Think about the total time spent completing and reviewing your tax return for your 2007 federal income tax return.

Include any time spent:

• reading instructions or other materials to complete or review your return

• completing or reviewing worksheets, forms, and schedules whether or not they were submitted

• completing Form W-4 to determine or change the amount of income tax your employer withholds from your pay {IF Q29=1}

• filing for an extension {IF Q6=1}

• having a paid professional review your software completed tax return

• calculating estimated tax payments

• forms you did not submit

Do not include any time spent on:

• state or local income tax returns

• Form 1041 for estates and trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations {IF Q9=1}

• payroll taxes {IF Q12=1}

• employment taxes

• accounting or payroll

• submitting your return

• consulting with a paid professional {IF Q13=3}

• activities other than preparing and reviewing

48. How much time did you, [your spouse, {IF Q3=1}], [your business employees {IF Q12=1}], friends, or relatives spend completing and reviewing your 2007 federal income tax return?

Hours Minutes

RANGE [0-99] RANGE [0-59]

49. Approximately, how much of that time was spent considering tax provisions before realizing you did not need to report on them?

Hours Minutes

RANGE [0-99] RANGE [0-59]

[Q49 MUST BE LESS THAN Q48 AND VERIFICATION SCREEN WILL APPEAR TO ENSURE Q49 IS LESS THAN Q48]

FORM SUBMISSION TIME

The next questions are about submitting your 2007 federal income tax return to the IRS.

50. How was your tax return submitted?

1. Mailed

2. Filed electronically

8. DON’T KNOW

9. REFUSED

51. For tax year 2007, did you complete Form 8453 or Form 8453-OL to provide your signature to the IRS?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

Think about the total time spent submitting your 2007 federal income tax return?

Include time spent:

• mailing your tax return

• photocopying and assembling your return

• providing an e-payment to the IRS

• checking on the status of your electronic return submission

• submitting your estimated tax payments

52. How much time did it take you, [your spouse, {IF Q3=1}], [your employees {IF Q12=1}], friends or relatives to submit your return?

Hours Minutes

RANGE [0-20, DK, RF, EX] RANGE [0-59, DK, RF, EX]

OUT OF POCKET COSTS

The next questions relate to the dollar costs associated with your 2007 federal income tax return, including but not limited to tax planning, record keeping, gathering tax materials, form completion, and form submission.

{IF Q13=3, GO TO Q53}

{IF Q13=1 OR Q13=2, SKIP TO Q57}

{IF Q13≠1 OR Q13≠2 or Q13≠ 3, SKIP TO Q64}

53. How much did you pay your paid professional in service fees for your 2007 federal tax return?

{IF Q13=3}

Include:

• just the base price and not additional items that were paid for separately

• tax preparation

• tax planning and advice

Do not include any portion of your costs related to:

• state or local income tax returns

• Form 1041 for estates or trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations {IF Q9=1}

• payroll taxes {IF Q12=1}

• employment taxes

• accounting or payroll

Enter Dollar Amount $ .00 RANGE [0-99999], DK, RF, EX

54. Did your paid professional file your 2007 federal income tax return electronically? {IF Q13=3}

1 YES

2 NO {SKIP TO Q64}

8 DON’T KNOW {SKIP TO Q64}

9 REFUSED {SKIP TO Q64}

55. Was this electronic filing cost included in your service fee? {IF Q13=3 AND Q54=1}

1 YES {SKIP TO Q64}

2 NO

8 DON’T KNOW {SKIP TO Q64}

9 REFUSED {SKIP TO Q64}

56. How much was your electronic filing fee? {IF Q13=3 AND Q55= 2}

Enter Dollar Amount $ .00 RANGE [0-999]

57. How much did you pay for your tax preparation software costs, installed or online, for your 2007 federal income tax return? {IF Q13=1 OR Q13=2}

Include:

• just the base price and not additional items that were paid for separately

Do not include any portion of your costs related to:

• any general purpose accounting software, such as Quicken, MSN Money, or QuickBooks

• state or local income tax returns

• Form 1041 for estates and trusts, Form 1065 for partnerships, or Form 1120 or 1120S for corporations {IF Q9=1}

• payroll taxes {IF Q12=1}

• employment taxes

• accounting or payroll

Enter Dollar Amount $ .00 RANGE [0-999]

58. Did you file your 2007 federal income tax return electronically using your software? {IF Q13=1 OR Q13=2}

1 YES

2 NO {SKIP TO Q64}

8 DON’T KNOW {SKIP TO Q64}

9 REFUSED {SKIP TO Q64}

59. Was this electronic filing fee included in the base price of the software? {IF Q13=1 OR Q13=2 AND Q58 = 1}

1 YES {SKIP TO Q64}

2 NO

8 DON’T KNOW {SKIP TO Q64}

9 REFUSED {SKIP TO Q64}

60. How much was your electronic filing fee? {IF Q13=1 OR Q13=2 AND Q59=2}

Enter Dollar Amount $ .00 RANGE [0-999]

61. Did you use the IRS free filing alliance program to file your 2007 federal income tax return?{IF Q13=1 OR Q13=2 AND Q60 = 0}

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

62. Did you use any live tax advice from your software package? {IF Q13=1 OR Q13=2}

1 YES

2 NO {SKIP TO Q64}

8 DON’T KNOW {SKIP TO Q64}

9 REFUSED {SKIP TO Q64}

63. How much was your live tax advice fee? {IF Q13=1 OR Q13=2 AND Q62=1}

Enter Dollar Amount $ .00 RANGE [0-999]

64. Did you owe a balance to the IRS on your 2007 federal income tax return?

1 YES

2 NO {SKIP TO Q66}

8 DON’T KNOW {SKIP TO Q66}

9 REFUSED {SKIP TO Q66}

65. Which method did you use to send your payment for your 2007 federal income tax? {IF Q64=1}

1 Personal Check

2 Credit or Debit Card

3 Electronic funds withdrawal from Checking/Savings Account

4 U.S. Treasury’s Electronic Federal Tax Payment System (EFTPS) ®

8 DON’T KNOW

9 REFUSED

66. Did you receive a refund anticipation loan?

PROMPT, READ ONLY IF NECESSARY: A refund anticipation loan is a loan in the amount of your anticipated tax refund minus certain fees.

1 YES

2 NO {SKIP TO Q68}

3 DID NOT RECEIVE A REFUND {SKIP TO Q68}

8 DON’T KNOW {SKIP TO Q68}

9 REFUSED {SKIP TO Q68}

67. How much was the fee charged to obtain this loan? {IF Q66=1}

Enter Dollar Amount $ .00 RANGE [0-999]

Think about any other out of pocket money you may have spent related to your 2007 federal income tax return.

Include:

• any fees paid for faxes, delivery, postage, classes, and books

Do not include:

• any fees paid for refund anticipation loans {IF Q66 =1}

• any fees for a paid professional {IF Q13=3}

• any fees for software installed or on-line {IF Q13=1 OR Q13=2}

68. How much money, if any, did you spend on [other {IF Q13=1 OR Q13=2 OR Q13=3}] expenses related to your 2007 federal income tax return?

Enter Dollar Amount $ .

RANGE [0-500.00] DK, RF, EX

69. What type of things did you spend money on for your 2007 federal income tax return? {IF greater than $500} {Please record}

Q69 Recode (Q69rec)

1 Classes/Books

TAXPAYERS WITH BUSINESS EMPLOYEES

[Now, I would like to ask you a few questions about your business employees {IF (Q8=1 OR Q10=1) AND Q12=1}.]

70. Did any employee(s) spend time on activities related to your personal 2007 federal income tax return?

1. YES

2. NO {SKIP TO Demographics}

8 DON’T KNOW {SKIP TO Demographics}

9. REFUSED {SKIP TO Demographics}

71. Which of following activities, if any, did your business employees spend time on for your personal 2007 federal income tax return?

{Select all that apply}

1. Kept your records

2. Gathered tax materials

3. Completed your tax return forms

4. Submitted your tax return forms

5. Performed any other activities for your 2007 federal income tax return? {Please ask respondent to specify the other activities and then record}

8 DON’T KNOW

9 REFUSED

72. Consider all of the time you and your business employees spent on your 2007 federal income tax return and related tax activities. How would you divide the total time spent by each type of business employee on federal income tax related activities?

1 Yourself/Spouse _____________%

2 Managers _____________%

3 Trained or Skilled _____________%

4 Clerical or Administrative _____________%

5 Other _____________%

8 DON’T KNOW

9 REFUSED

{If answer to Q72 is not equal to 100%, a verification screen will appear}

DEMOGRAPHICS

Finally, I would like to ask a few questions about you.

73. Which category best describes the highest level of education that you have completed?

1. Less than high school

2. High school graduate or equivalent

3. Some technical or vocational school

4. Technical or vocational school graduate

5. Some college

6. College graduate

7. Some graduate or professional school

8. Graduate or professional school degree

88. DON’T KNOW

99. REFUSED

74. Do you have access to a computer at home or at work?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

75. Do you have access to the internet at home or at work?

1 YES

2 NO

8 DON’T KNOW

9 REFUSED

76. During the past week, how many times, if any, have you accessed the internet either at home or at work?

1. 0 times

2. 1 to 5 times

3. 6 to 10 times

4. 11 or more times

8. DON’T KNOW

9. REFUSED

77. What is the primary language spoken in your household?

1. ENGLISH

2. SPANISH

3. OTHER {Please record}

8. DON’T KNOW

9 REFUSED

This concludes our interview. Thank you very much for your time. As a token of our appreciation for your help with this study, we will send you $XX.00. I would now like to verify your name and address. {Confirm name and address}

NAME: ______________________________

ADDRESS:

CITY: ____________________ STATE: ZIP Code: ___

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