Is e-filing really a better way to record your taxes?
Americans and the IRS might not agree on everything, but they’re mostly on precisely the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
In return, you can find any refund you’re owed quicker, especially in the event that you have it directly deposited into your bank accounts.
But what about security? And can electronic filing actually provide you access to all the forms that you might need in case you have a intricate tax situation? Are there ever situations when you can not e-file? Let us look at the advantages of e-filing, and whether it might be the best filing choice for your requirements.
If you’re thinking about e-filing, a Few of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing was 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 3 weeks or not. Choosing direct deposit can also speed up the refund process.
Reduced chance of mistakes: In accordance with the IRS, there’s approximately a 1% error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it is easier to cover at your convenience if you e-file. You can submit returns early and pay afterwards if necessary, as long as you pay by the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Direct pay service from your checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) will lead to interest and penalties.
Digital storage of tax data: Submitting returns electronically means there’s a digital copy of your tax records. So if something happens to your paperwork, you will have a digital backup.
The good news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing this is simple.
Employing online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it expected over four in five tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you may be worried about security — particularly with all these data breaches. But experts agree that this is not a problem that should dissuade you by e-filing.
“In fact, it may be more secure than paper filing as you’re sending your personal information through an encrypted system as opposed to exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set safety measures in place to keep your data safe. “Vendors typically utilize IRS particular APIs that require ab sessions,” Chow says. “All this is routed over TLS encrypted links .”
It’s very important to use a trustworthy service to help you record your taxes. Chow advises not to e-file on a computer or use an online connection which isn’t confidential.
For many taxpayers, it makes sense to e-file a yield because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be certain that you use tax preparation software from a dependable source, so you may ensure the information you provide to transmit to the IRS is going to be kept protected.