Is e-filing a better way to file your taxes?
Americans and the IRS may not agree about everything, but they are mostly on the exact same page when it comes 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.
If you e-file your federal income tax return, you save the IRS money because its workers don’t need to spend time manually processing your return. And in return, you could find any refund you are owed faster, especially in the event that you have it directly deposited into your bank accounts.
But what about safety? And can electronic filing actually provide you access to all the forms that you may need in case you have 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 very best filing option for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will confirm a tax filing has been received within 24 hours of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived safely.
Timely refunds: When you publish a paper filing, it can take six to eight weeks to receive a tax refund. With e-filing, you are going to receive your money in three weeks or not. Choosing direct deposit can also accelerate the refund procedure.
Reduced likelihood of mistakes: In accordance with the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% speed of errors on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper yields.
Simple payment procedure: If you owe the IRS money, it is simpler to pay at your convenience when you e-file. You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline. And you’re able to schedule electronic money transfers to easily 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 option to pay your balance by using the IRS Direct pay service from the checking or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) can result in penalties and interest.
Digital storage of tax data: Submitting returns electronically means there is an electronic copy of your tax records. So if something happens to your paperwork, you’ll have an electronic backup.
The good news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is simple.
How to e-file a tax return?
The types do the math for you and offer basic guidance. You can only do your federal return with these forms.
Employing online tax prep software is far and away the preferred approach of the majority of taxpayers. In fact, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you may be worried about safety — especially with so many data breaches. But experts agree this isn’t a problem that should deter 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 email.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has put safety measures in place to keep your information secure. “Trainers normally use IRS specific APIs that need ab sessions,” Chow says. “All of this is routed over TLS encrypted connections”
It is very important to use a trusted service to help you file your taxes. Chow advises to not e-file on a public computer or utilize an internet connection which is not confidential.
For most taxpayers, it is sensible to e-file a return since 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 be certain to use tax preparation software from a trusted source, so you may ensure the information you provide to transmit to the IRS is going to be kept protected.