Is e-filing really a better way to file your taxes?
Americans and the IRS may not agree on everything, but they’re 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 because it’s a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you conserve the IRS cash because its employees don’t need to spend time manually processing your return. And in return, you could find any refund you are owed faster, particularly if you have it directly deposited into your bank accounts.
But what about safety? And can digital filing actually give you access to all of the forms you might need in case you’ve got a complex tax situation? Are there ever situations when you can not e-file? Let us look at the advantages of e-filing, and if it might be the best filing option for your requirements.
If you’re thinking about e-filing, some of the advantages include:
- Quick affirmation your forms are obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived .
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 receive your money in 3 weeks or less. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of mistakes: According to the IRS, there’s around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Easy payment process: If you owe the IRS money, it is simpler to cover at your convenience if you e-file. It’s possible to submit returns early and pay later if needed, provided that you pay by the April 15 filing deadline. Additionally you have the option to pay your balance by using the IRS Direct pay service from your checking account or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of taxation information: Submitting returns electronically implies there’s an electronic backup of your tax documents. So if something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the process of doing this is simple.
The way to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may have the ability to use the IRS Free File program. The forms do the math for you and offer standard advice. You can simply do your federal return with these forms.
- Use an online tax preparation tax or service software: Tax preparation software and online filing services are options. These choices are an easy way to finish and e-file your own forms. Some applications providers charge for their apps, Some are liberated. The software asks you simple questions about your life and finances to steer you through the completion of your types.
- Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns. But eligibility for free help is typically limited based on earnings, and some providers cater to specific demographic groups. By way of example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they’re licensed IRS e-file providers. The IRS maintains a record of authorized providers, but you should be aware this option is likely to be the most costly one.
Employing online tax preparation software is far and away the favored approach of the majority of 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 convenient, you may worry about security — especially with all these data breaches. But experts agree that this is not a problem that should dissuade you from e-filing.
“In fact, it may be more secure than paper filing since you’re sending your private information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set security measures in place to keep your data safe. “Trainers normally use IRS specific APIs that require ab sessions,” Chow says. “All this can be routed over TLS encrypted links “
It is very important to employ a trusted service that will assist you record your taxes. Chow advises not to e-file on a computer or utilize an online connection that isn’t confidential.
For most 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 make certain to use tax planning software from a dependable source, so you can make certain the information you supply to transmit to the IRS is going to be kept secure.