Is e-filing really a better way to record your taxes?
Americans and the IRS might not agree on everything, but they are largely on the same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed. E-filing is a favorite because it is a win-win for taxpayers and the IRS.
And in return, you could get any refund you’re owed quicker, particularly if you have it directly deposited to your bank account.
However, what about security? And can electronic filing really give you access to all the forms you might need in case you have a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it might be the 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 has been received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund. With e-filing, you are going to receive your money in three weeks or less. Choosing direct deposit can also accelerate the refund procedure.
Reduced likelihood of mistakes: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% rate of errors on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.
Easy payment process: If you owe the IRS money, it is easier to pay at your advantage when you e-file. You can submit returns early and pay later if needed, provided that you pay by the April 15 filing deadline. You also have the option to pay your balance by making use of the IRS Immediate pay service from the checking or savings accounts, submitting 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’s a digital copy of your tax documents. If something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the process of doing so is simple.
The way to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
- 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 basic guidance. You can simply do your federal return with all these forms.
- Use an internet tax preparation tax or service applications: Tax preparation software and online filing services are alternatives. These options are a simple way to finish and e-file your own forms. Some applications providers charge for their apps, Some are liberated. The program asks you simple questions about your life and finances to steer you through the completion of your forms.
- Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields. But eligibility for free help is normally restricted based on income, and a few providers cater to specific demographic groups.
- Hire a paid preparer: Paid tax preparers, including CPAs, can e-file yields for you if they’re authorized IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this alternative is likely to be the most costly one.
Employing online tax preparation software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it anticipated over four tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you may worry about safety — especially with all these data breaches. But experts agree this is not a problem which should dissuade you from e-filing.
“In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted network as opposed to exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has set security measures in place to keep your data secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All this can be routed over TLS encrypted connections”
It’s very important to use a trustworthy service that will help you file your taxes. Chow advises to not e-file on a computer or use an internet 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 choices. Just make sure that you use tax preparation software from a dependable source, so that you can ensure the information you supply to transmit to the IRS is going to be kept protected.