Nebraska Gov. Dave Heineman today encouraged Nebraska taxpayers to consider using the free e-file option when reporting income taxes for tax year 2007, and announced that e-filings in 2007 increased by more than 4 percent.

"The ability to file and pay taxes online is another way our state is providing the services Nebraskans need, while also helping ensure greater efficiency in government," Gov. Heineman said. "E-filing is a quick, convenient way citizens can help cut costs at the state level."

Known as e-filing, electronic filing allows most taxpayers who submitted a state tax return last year to file their Nebraska short form (Form 1040NS) or long form (Form 1040N) free via the Nebraska Department of Revenue's Web site.

In 2007, the state received roughly 532,000 electronic income tax filings, which was up 4.23 percent from the previous year's electronic returns. More than 62 percent of all Nebraska tax returns were filed electronically last year. Of the 41 states reporting e-filing statistics, Nebraska was ranked sixth in the nation based on the percentage of e-filers for tax year 2006.

Revenue has set a goal of seeing 70 percent of state tax returns filed electronically during 2008. Of the 200,000 state income tax returns filed so far this year, 180,000 have been submitted using NebFile, the e-file system developed by the state.

Tax Commissioner Doug Ewald said, "With 90 percent of returns coming in via e-file so far, we're on our way to meeting our goal, and we hope that more taxpayers will consider using our NebFile system this year. I want to thank the tax preparation community for embracing this option along with individual taxpayers. E-filing is not only quicker and more efficient, it reduces the risk of errors and provides immediate confirmation that a return has been received."

Taxpayers entitled to a refund who e-file and choose to have their refund returned via direct deposit typically see the money deposited in their bank account in seven to 10 business days.

The increase in e-filing has helped Revenue achieve greater efficiency by reducing reliance on temporary workers at tax time. Seasonal employees are expected to total 60 this year, down from 150 a decade ago. Better technology, streamlining, e-filing, and tax payments made via electronic funds transfers have also helped Revenue trim full-time staff needs in recent years.