Is e-filing a much better way to record your taxes?
Americans and the IRS may not agree about everything, but they are largely on precisely the same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed.
When you e-file your federal income tax return, you save the IRS cash because its employees don’t need to spend time manually processing your return. And in return, you can find any refund you’re owed quicker, especially if you have it directly deposited into your bank accounts.
But what about security? And can electronic filing really provide 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’s look at the benefits of e-filing, and if it might be the very best filing option for your requirements.
If you’re thinking about e-filing, a Few of the advantages include:
- Quick confirmation your forms have been received: The IRS will affirm a tax filing has been received within 24 hours of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived .
Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given a tax refund. With e-filing, you’ll get your money in three weeks or not. Choosing direct deposit can also accelerate the refund process.
Reduced chance of errors: According to the IRS, there’s approximately a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper yields.
Simple payment process: If you owe the IRS money, it is simpler to pay at your advantage when you e-file. It’s possible to submit returns early and pay later if needed, provided that you pay from the April 15 filing deadline. And you’re able to schedule electronic funds transfers to send the IRS what you owe on a date of your choosing — again, as long as the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by using the IRS Direct pay service from the checking or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) will lead to penalties and interest.
Digital storage of tax information: Submitting returns electronically means there’s a digital copy of your tax records. If something happens to your paperwork, then you will have a digital backup.
The good news: Most taxpayers do opt to e-file and get those advantages — and the process of doing this is simple.
How to e-file a tax return?
You have four choices for filing an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it expected over four tax returns to be submitted through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you could be worried about safety — particularly with so many data breaches. But experts agree this isn’t a problem that should deter you from e-filing.
“In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system as opposed to 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 data safe. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All this is routed over TLS encrypted connections.”
It is important to employ a trusted service to help you file your taxes. Chow advises to not e-file on a public computer or use an internet connection which is not private.
For many taxpayers, it is sensible to e-file a yield since it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options. Just make sure that you use tax preparation software from a trusted source, so that you can make certain the information which you supply to transmit to the IRS will be kept protected.