Is e-filing really a better way to record your taxes?
Americans and the IRS might not agree about everything, but they’re largely on the same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed. E-filing is popular because it’s a win-win for taxpayers and the IRS.
If 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 could find any refund you’re owed quicker, particularly in the event that you have it directly deposited to your bank accounts.
But what about safety? And can electronic filing really provide you access to all the forms that you may need in case you have a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it might be the best filing choice for your requirements.
If you are thinking about e-filing, a Few 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 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 weeks to be given a tax refund. With e-filing, you are going to get your money in three weeks or not. Choosing direct deposit may also speed up the refund procedure.
Reduced chance of mistakes: In accordance with the IRS, there is approximately 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 returns compared with paper returns.
Easy payment procedure: If you owe the IRS money, it is simpler to cover at your advantage if you e-file. It’s possible to submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline. And you can schedule electronic money transfers to easily send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. You also have the option to pay your balance by using the IRS Immediate pay service from your checking or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax information: Submitting returns electronically means there’s a digital backup of your tax records. So if something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing so is simple.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you may have the ability to use the IRS Free File program. The forms do the math for you and provide standard advice. You can simply do your federal return with these kinds.
- Use an internet tax preparation tax or service applications: Tax prep software and online filing services are alternatives. These choices are an easy way to finish and e-file your forms. Some applications providers charge for their apps, Some are free. The software asks you simple questions about your life and finances to guide 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 yields. However, eligibility for free aid is normally restricted based on income, 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. The IRS maintains a database of licensed providers, but you should be aware this option is very likely to be the most costly one.
Using online tax prep software is far and away the favored approach of most taxpayers. Actually, the IRS says it anticipated 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 safety — particularly with so many data breaches. But experts agree this is not a problem which should deter you by e-filing.
“In actuality, it can be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has set security measures in place to keep your data secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It is important to employ a trusted service that will assist you file your taxes. Chow advises not to e-file on a computer or utilize an online connection that is not confidential.
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 preparation software from a dependable source, so you can make certain the information which you supply to transmit to the IRS is going to be kept protected.