Is e-filing really a better way to file your taxes?
Americans and the IRS may not agree on everything, but they’re mostly on precisely the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is a favorite as it’s a win-win for taxpayers and the IRS.
And in return, you can find any refund you are owed faster, particularly 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 the forms that you may need if you have a complex tax situation? Are there situations when you can’t e-file? Let’s look at the benefits of e-filing, and if it may be the very best filing option for your requirements.
If you’re Considering e-filing, a Few 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 doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit 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 not. Choosing direct deposit may also speed up the refund procedure.
Reduced chance of mistakes: According to the IRS, there’s approximately 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 returns compared with paper yields.
Simple payment procedure: If you owe the IRS money, it is easier to cover at your convenience 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 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 accounts, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there’s an electronic backup of your tax documents. So if something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the process of doing so is easy.
You have four choices for filing an electronically filed tax return to the IRS.
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you may be able to use the IRS Free File program.
- Free File Fillable Forms — If your income is more than $72,000 and you’re comfortable doing your earnings without any assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer standard guidance. You can simply do your federal return with all these forms.
- Utilize an internet tax preparation service or tax applications: Tax preparation software and online filing services are alternatives. These options are an easy way to finish and e-file your own forms. Some applications suppliers charge for their programs, Some are liberated. The software asks you simple questions about your own life and financing to guide you through the completion of your forms.
- Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields. But eligibility for free help is normally restricted based on earnings, and a few services cater to specific demographic groups. The IRS maintains a record of authorized providers, but be aware this alternative is likely to be the most costly one.
Using online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it anticipated over four in five tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you may be worried about safety — particularly with all these data breaches. But experts agree this is not a problem which should dissuade you from 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, marketing and sales at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has set safety measures in place to keep your data secure. “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It’s very important to use a trusted service that will help you record your taxes. Chow advises to not e-file on a computer or use an internet connection that isn’t confidential.
For most taxpayers, it makes sense to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just make sure to use tax preparation software from a dependable source, so that you may make certain the information which you supply to transmit to the IRS will be kept secure.