Is e-filing a much better way to record your taxes?
Americans and the IRS might not agree about everything, but they are mostly on the exact same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed. E-filing is popular as it is a win-win for taxpayers and the IRS.
And in return, you could get any refund you are owed quicker, especially in the event that you have it directly deposited to your bank account.
But what about safety? And can digital filing really give you access to all of the forms that you may need if you’ve got a complex tax situation? Are there situations when you can not e-file? Let’s look at the advantages of e-filing, and if it may be the best filing option for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you are going to get your money in three weeks or less. Choosing direct deposit may also accelerate the refund process.
Reduced likelihood of mistakes: In accordance with the IRS, there’s around a 1 percent error rate on e-filed yields, compared with a 20% speed of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.
Easy payment process: If you owe the IRS money, it is simpler to cover at your advantage when you e-file. It’s possible to submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Immediate pay service from the checking account or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of taxation information: Submitting returns electronically means there’s an electronic backup of your tax records. So if something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing so is easy.
You have four choices for filing an electronically filed tax return to the IRS.
- Use IRS Free File: If your adjusted gross income is $72,000 or less you could have the ability to use the IRS Free File program. The forms do the math for you and offer standard guidance. You can simply do your federal return with these forms.
- Use an internet tax preparation service or tax applications: Tax preparation software and online filing services are options. These choices are a simple way to complete and e-file your forms. Some software suppliers charge for their apps, Some are free. The program asks you simple questions about your life and finances to guide you through the completion of your types.
- Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns. But eligibility for free aid is typically limited based on income, and a few providers appeal to specific demographic groups. The IRS maintains a record of licensed providers, but be aware this alternative is very likely to be the most costly one.
Using online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it expected more than four in five tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you could be worried about safety — particularly with so many data breaches. But experts agree this is not an issue that should deter you from e-filing.
“In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has put security measures in place to keep your data secure. “Trainers normally use IRS particular APIs that require token sessions,” Chow says. “All of this can be routed over TLS encrypted connections.”
It’s important to use a trusted service that will assist you file your taxes. Chow advises not to e-file on a computer or use an internet connection which is not private.
For many taxpayers, it is sensible to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options. Just make certain to use tax preparation software from a dependable source, so you may ensure the information which you supply to transmit to the IRS will be kept secure.