Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are mostly on precisely 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 a favorite because it’s a win-win for taxpayers and the IRS.
And in return, you can find any refund you’re owed quicker, particularly if you have it directly deposited to your bank account.
However, what about security? And can electronic filing actually give you access to all of the forms that you might need if you have a intricate tax situation? Are there situations when you can’t e-file? Let’s look at the advantages of e-filing, and whether it may be the very best filing option for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing was received within one day of digital submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may 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 can also accelerate the refund process.
Reduced likelihood of errors: 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 information on issues discovered on e-filed yields compared with paper returns.
Easy 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 afterwards if needed, provided that you pay by the April 15 filing deadline. You also have the option to pay your balance by using the IRS Direct pay service from the checking account 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 result in interest and penalties.
Digital storage of taxation data: Submitting returns electronically implies there is a digital copy of your tax documents. So if something happens to your paperwork, then you will have a digital backup.
The good news: Most taxpayers do decide to e-file and find those benefits — and the process of doing this is easy.
How to e-file a tax return?
Using online tax prep software is far and away the favored approach of most taxpayers. In fact, the IRS says it expected over four in five tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you could worry about safety — particularly with all these data breaches. But experts agree that this is not a problem that should deter you by e-filing.
“In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted system rather than exposing your data 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. “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says. “All this is routed over TLS encrypted links “
It’s very important to employ a trusted service to help you record your taxes. Chow advises to not e-file on a computer or utilize an online connection which is not confidential.
For most taxpayers, it makes sense to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment options. Just be certain to use tax planning software from a dependable source, so you may ensure the information which you supply to transmit to the IRS will be kept secure.