Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree about everything, but they’re mostly 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 as it’s a win-win for taxpayers and the IRS.
And in return, you can get any refund you’re owed quicker, especially in the event that you have it directly deposited to your bank accounts.
But what about safety? And can electronic filing actually give you access to all of the forms you may need in case you have a intricate tax situation? Are there ever situations when you can not e-file? Let’s look at the advantages of e-filing, and if it might be the best filing option for your requirements.
If you are 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 one day of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
Timely refunds: When you submit 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 3 weeks or not. Choosing direct deposit can also accelerate the refund process.
Reduced chance of mistakes: According to the IRS, there is approximately a 1% error rate on e-filed yields, compared with a 20% rate of errors on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper returns.
Simple payment process: If you owe the IRS money, it is easier to cover at your advantage if you e-file. You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. You also have the choice to pay your balance by making use of the IRS Immediate pay service from your checking 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 data: Submitting returns electronically means there is an electronic backup of your tax records. So if something happens to your paperwork, then you will have a digital backup.
The good news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing so is easy.
The way to e-file a tax return?
Employing online tax preparation software is far and away the preferred approach of the majority of taxpayers. In fact, the IRS says it expected more than four tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you could worry about security — especially with so many data breaches. But experts agree that this isn’t a problem that should dissuade you from e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and sales at LegalShield. “In fact, 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 the IRS has set safety measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted links “
It’s important to employ a trusted service that will help you record your taxes. Chow advises not to e-file on a computer or use an online connection that is not private.
For many taxpayers, it is sensible to e-file a return since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just make certain that you use tax preparation software from a trusted source, so that you may make certain the information which you supply to transmit to the IRS will be kept secure.