Is e-filing a much better way to record your taxes?
Americans and the IRS might not agree on everything, but they are largely on precisely the exact 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.
If you e-file your federal income tax return, you conserve the IRS money because its employees don’t have to spend time manually processing your return. And in return, you can find any refund you are owed quicker, especially in the event that you have it directly deposited to your bank accounts.
However, what about security? And can digital filing really provide you access to all the forms you might need if you’ve got a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the advantages of e-filing, and whether it might be the best filing option for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment 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 receive your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced chance of mistakes: In accordance with the IRS, there is approximately 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 issues discovered on e-filed returns compared with paper yields.
Simple payment process: If you owe the IRS money, it’s simpler to pay at your convenience when you e-file. You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. And you can schedule electronic money 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 option to pay your balance by using the IRS Immediate pay service from the checking or savings accounts, submitting 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 implies there is a digital backup of your tax documents. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the process of doing this is simple.
How to e-file a tax return?
- 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 provide standard guidance. You can only do your federal return with all these forms.
- Use an online tax preparation service or tax applications: Tax preparation software and online filing services are alternatives. These choices are an easy way to finish and e-file your own forms. Some software suppliers charge for their apps, Some are free. The program asks you simple questions about your life and finances to guide you through the completion of your types.
- Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns. But eligibility for free help is typically limited based on income, and some services 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 record of licensed providers, but be aware this option is likely to be the most costly one.
Using online tax prep 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 program.
Is e-filing really stable?
While e-filing is suitable, you may be worried about safety — especially with all these data breaches. But experts agree this is not an issue that should dissuade you by e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and revenue at LegalShield. “In actuality, it can 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 data security at SCIS Security, explains that the IRS has set safety measures in place to keep your information secure. “Vendors typically utilize IRS specific APIs that require ab sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It is important to employ a trusted service to assist you record your taxes. Chow advises not to e-file on a public computer or use an online connection that is not confidential.
For most taxpayers, it makes sense to e-file a return because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options. Just be certain to use tax preparation software from a trusted source, so you can make certain the information you supply to transmit to the IRS will be kept secure.