Taxpayers can pick own PIN

The Internal Revenue Service will make it easier to file returns electronically this year by letting taxpayers select their own personal identification number for digital signatures.

For the first time, taxpayers will be allowed to pick a PIN to be used, whether they calculate their own returns or pay an accountant to do it. A taxpayer can pick any set of five digits except five zeros.

The IRS has conducted several pilot projects during the past two years, assigning PINs to select taxpayers. But taxpayers still had to send in a paper copy of their signatures, and this extra step deterred many individuals from participating in the fledging electronic filing program, IRS spokesman Don Roberts said.

The pen-on-paper signature requirement has been eliminated for filing year 2000 tax returns. In its place, taxpayers select a PIN and submit information verifying their identity — their adjusted gross income and total tax liability from their 1999 returns.

Nevertheless, taxpayers still face some hurdles in adapting to electronic filing. A taxpayer must file a return to an IRS-approved transmitter that sends the form to the tax agency on a secure Internet line. To do that, a taxpayer must use IRS-approved software or an authorized accountant. The IRS set up the procedure for security purposes, Roberts said.

"We are making it as easy as possible by letting them select their own PIN," Roberts said.

More than 35 million Americans filed their tax returns electronically last year — a 20 percent increase from the previous year. This year, the IRS expects more than 42 million taxpayers to e-file.