Is e-filing really a much better way to record your taxes?
Americans and the IRS might not agree about everything, but they’re mostly on precisely the 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 a favorite because it’s a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you conserve the IRS money because its workers do not have to spend time manually processing your return. And in return, you could find any refund you are owed faster, especially if you have it directly deposited into your bank account.
But what about safety? And can electronic filing really give you access to all the forms that you may need in case you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and if it might be the best filing choice for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will confirm a tax filing was received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived safely.
Timely refunds: When you publish a paper filing, it may take six to eight months to receive a tax refund. With e-filing, you are going to get your money in 3 weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced likelihood of errors: In accordance with the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed yields compared with paper yields.
Simple payment procedure: If you owe the IRS money, it’s simpler to cover at your advantage when you e-file. You can submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline. And you can schedule electronic funds transfers to easily send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by making use of the IRS Direct pay service from your checking or savings accounts, 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 implies there’s an electronic copy of your tax records. So if something happens to your paperwork, you’ll have an electronic backup.
The good news: Most taxpayers do opt to e-file and get those benefits — and the process of doing so is easy.
How to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
Employing online tax prep software is far and away the preferred approach of most taxpayers. Actually, the IRS says it anticipated over four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you could be worried about security — particularly with all these data breaches. But experts agree this isn’t an issue that should dissuade you by e-filing.
“In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your data in the email.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has put safety measures in place to keep your information safe. “Trainers normally use IRS specific APIs that need ab sessions,” Chow says. “All of this can be routed over TLS encrypted links “
It is important to use a trustworthy service to help you record your taxes. Chow advises to not e-file on a computer or use an internet connection that isn’t confidential.
For most taxpayers, it makes sense to e-file a yield because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be sure to use tax preparation software from a dependable source, so that you can make certain the information which you provide to transmit to the IRS will be kept secure.