Is e-filing a much better way to file your taxes?
Americans and the IRS might not agree on 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. E-filing is popular because it’s a win-win for taxpayers and the IRS.
And in return, you could find any refund you are owed quicker, particularly if you have it directly deposited into your bank accounts.
However, what about security? And can digital filing actually provide you access to all the forms you may need in case you’ve got a intricate tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and if it might be the very best filing option for your needs.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will confirm a tax filing has been 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 months to be given a tax refund. With e-filing, you are going to receive your money in three weeks or less. Choosing direct deposit may also accelerate the refund process.
Reduced chance of errors: According to the IRS, there is approximately a 1% error rate on e-filed yields, compared with a 20% speed of errors on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Easy payment procedure: If you owe the IRS money, it is simpler to pay at your convenience if you e-file. It’s possible to submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline. And you can 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. You also have the choice to pay your balance by using the IRS Immediate pay service from the checking account or savings account, filing 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) can lead to penalties and interest.
Digital storage of taxation information: Submitting returns electronically implies there’s an electronic copy of your tax documents. So if something happens to your paperwork, then you’ll have a digital backup.
The good news: Most taxpayers do opt to e-file and find those advantages — and the practice of doing so is simple.
The way to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program. The types do the math for you and offer standard advice. You can only do your federal return with all these forms.
- Use an online tax preparation service or tax software: Tax preparation software and online filing services are options. These options are a simple way to complete and e-file your own forms. Some applications suppliers charge for their programs, Some are free. The program 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 yields. But eligibility for free aid is typically limited based on income, and some services cater to particular demographic groups. The IRS maintains a record of licensed providers, but be aware this alternative is likely to be the most costly one.
Employing online tax prep software is far and away the favored approach of most taxpayers. In fact, 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 be worried about security — especially with all these data breaches. But experts agree that this is not an issue that should deter you from 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 may be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set safety measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require ab sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It is very important to employ a trustworthy service that will help you record your taxes. Chow advises to not e-file on a public computer or utilize an internet connection that is not confidential.
For most taxpayers, it is sensible 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 effortless payment options. Just be sure to use tax planning software from a dependable source, so you may make certain the information which you provide to transmit to the IRS is going to be kept protected.