Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re mostly on the 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. E-filing is popular because it’s a win-win for taxpayers and the IRS.
In return, you could get any refund you are owed faster, especially in the event that you have it directly deposited into your bank accounts.
However, what about security? And can digital filing actually provide you access to all of the forms you might need if you have a intricate tax situation? Are there ever situations when you can’t e-file? Let us look at the benefits of e-filing, and whether it may be the best filing option for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm a tax filing was received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived .
Timely refunds: When you submit a paper filing, it may take six to eight weeks to be given a tax refund. With e-filing, you’ll receive your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed returns compared with paper returns.
Easy payment process: If you owe the IRS money, it’s simpler to cover at your convenience when you e-file. You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline. And you’re able to schedule electronic funds transfers to send the IRS what you owe on a date of your choosing again, provided that the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by making use of the IRS Direct pay service from the checking 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 after the filing due date (typically April 15) can result in penalties and interest.
Digital storage of taxation data: Submitting returns electronically implies there’s an electronic backup of your tax records. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the process of doing this is easy.
The way to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
The types do the math for you and provide basic guidance. You can simply do your federal return with these forms.
Using online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, 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 suitable, you may worry about security — particularly with all these data breaches. But experts agree that this isn’t a problem that should dissuade you by e-filing.
“In actuality, it can be more secure than paper filing since 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, clarifies that the IRS has set safety measures in place to keep your data secure. “Trainers normally use IRS specific APIs that require ab sessions,” Chow says. “All of this is routed over TLS encrypted links .”
It’s important to employ a trustworthy service that will help you record your taxes. Chow advises not to e-file on a computer or utilize an online connection which isn’t private.
For most taxpayers, it makes sense to e-file a return since it is 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 planning software from a trusted source, so you may ensure the information which you provide to transmit to the IRS is going to be kept protected.