U.S. launching Net tax-payment service

The Treasury Department is set to launch a service that will let individuals and businesses pay their federal taxes via the Internet.

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The U.S. Treasury Department said Wednesday that it is launching a service that will let individuals and businesses pay federal taxes online.

Taxpayers will be able to access the service beginning Thursday through the Electronic Federal Tax Payment System (EFTPS-Online) Web site. The service will give people round-the-clock access to their tax information, as well as allowing them to document transactions and view payment history.

"In the past, businesses and some individuals could make electronic payments over EFTPS using special-purpose heavy client tools," said Gary Grippo, the Treasury Department's chief architect of e-commerce. "Beginning tomorrow, businesses and individuals will be able to make payments anytime over the Internet using a Web browser."

He also said businesses who make tax payments using coupons through their banks will be able to move that process to the Web.

Although EFTPS-Online was introduced in 1996, a pilot program for the online payment service has only been in place since October. Taxpayers will be able to sign up for the service on the site.

The Internal Revenue Service has long been criticized for not doing enough to cater to taxpayers. The new service aims to simplify the IRS' famously cumbersome paper-shuffling process.

Though taxpayers will not be able to file their returns online through the service, Grippo said the government is eyeing that prospect.

The launch comes just weeks after the IRS announced it would implement PeopleSoft's customer relationship management software. The software enables organizations to manage their front-office operations, including sales, marketing and customer service.

The IRS and Treasury Department are taking part in a broader push to improve the way government agencies buy products from suppliers and communicate with the public. Increasing the adoption of technology and the Internet within the federal government has been dubbed "e-government" by some.

This summer, the U.S. General Services Administration set a July 1 deadline to have its contracted suppliers list their products on its online exchange. The move was expected to have increased the number of Internet-enabled suppliers from 4,000 to 9,000 and was to have put approximately 4 million products on the agency's exchange.

Agency officials saw the move as a big step in getting the government more reliant on e-commerce and making online purchasing more mainstream.

Many state governments have also gotten into the game. Pennsylvania, for one, announced a program in May that allows residents to take care of many Department of Motor Vehicle tasks online. Drivers can renew their licenses, update photo IDs, and fill out vehicle registration forms on the Web.

Pennsylvania's initiative aims to reduce expenses for the state and to cater to the many residents who see their local DMV office as a place of long lines and confusing forms.

Taxpayers signing up for the EFTPS-Online service will be mailed a confirmation kit with instructions for obtaining an Internet password, government officials said. Participants will receive a PIN as part of a separate mailing for added security.