Is e-filing a better way to file your taxes?
Americans and the IRS may not agree about everything, but they are largely on the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is a favorite as it’s a win-win for taxpayers and the IRS.
And in return, you can get any refund you’re owed faster, especially if you have it directly deposited to your bank accounts.
But what about security? And can digital filing actually give you access to all of the forms that you might need in case you have a intricate tax situation? Are there situations when you can’t e-file? Let us look at the benefits of e-filing, and whether it may be the very best filing option for your needs.
If you’re Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
Timely refunds: When you publish 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 may also accelerate the refund procedure.
Reduced likelihood of errors: According to the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more info on issues discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it’s simpler to cover at your convenience when you e-file. It’s possible to submit returns early and pay afterwards 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 Direct pay service from the checking account or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there’s a digital copy of your tax records. So if something happens to your paperwork, you will have an electronic backup.
The good news: Most taxpayers do decide to e-file and find those benefits — and the process of doing so is simple.
How to e-file a tax return?
The forms do the math for you and provide standard advice. You can simply do your federal return with all these forms.
Employing online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it expected more than four in five tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you may be worried about security — particularly with so many data breaches. But experts agree this isn’t an issue that should dissuade you from e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has put security measures in place to keep your information secure. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All this is routed over TLS encrypted links “
It is important to employ a trustworthy service that will help you file your taxes. Chow advises not to e-file on a computer or use an internet connection which is not private.
For most taxpayers, it is sensible to e-file a return because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be certain to use tax planning software from a dependable source, so you can make certain the information you provide to transmit to the IRS will be kept protected.