Is e-filing really a much better way to file 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.
Nearly all individual income tax returns submitted 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 find any refund you’re owed faster, especially if you have it directly deposited into your bank accounts.
However, what about security? And can digital filing really give you access to all of the forms you may need if you’ve got a intricate tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it may 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 confirm a tax filing has been received within 24 hours of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived .
Timely refunds: When you publish a paper filing, it can take six to eight weeks to receive a tax refund. With e-filing, you are going to get your money in three weeks or not. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of mistakes: 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 info on problems discovered on e-filed yields compared with paper yields.
Simple payment process: If you owe the IRS money, it is simpler to pay at your advantage if you e-file. It’s possible to submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. Additionally you have the choice to pay your balance by using the IRS Direct 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. Just be aware delaying payment after the filing due date (typically April 15) will lead to penalties and interest.
Digital storage of tax information: Submitting returns electronically means there is an electronic backup of your tax records. If something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the process of doing this is simple.
You have four choices for filing an electronically filed tax return to the IRS.
The types do the math for you and provide standard guidance. You can only do your federal return with these forms.
Employing online tax prep software is far and away the preferred approach of most taxpayers. Actually, the IRS says it expected over four 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 safety — particularly with so many data breaches. But experts agree that this isn’t an issue that should deter you by e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has set security measures in place to keep your information secure. “Vendors typically utilize IRS particular APIs that need ab 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 not to e-file on a public computer or use an internet connection that is not private.
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 effortless payment choices. Just be sure that you use tax planning software from a trusted source, so that you may ensure the information you supply to transmit to the IRS will be kept protected.