Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on precisely 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 popular because it is a win-win for taxpayers and the IRS.
And in return, you can find any refund you’re owed faster, particularly in the event that you have it directly deposited to your bank accounts.
But what about safety? And can electronic filing really give you access to all the forms that you might need if you’ve got a intricate tax situation? Are there situations when you can not e-file? Let us look at the advantages of e-filing, and if it might be the very best filing option for your requirements.
If you’re thinking about 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 electronic 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 may take six to eight weeks to receive a tax refund. With e-filing, you’ll get your money in three weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced likelihood of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed yields, 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 pay at your convenience when you e-file. It’s possible to submit returns early and pay later if necessary, provided that you pay from the April 15 filing deadline. And you can schedule electronic funds 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. You also have the choice to pay your balance by making use of the IRS Direct pay service from the checking account 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 implies there’s an electronic copy of your tax records. If something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the process of doing so is simple.
How to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you could have the ability to use the IRS Free File program. The types do the math for you and offer standard advice. You can only do your federal return with all these forms.
- Utilize an internet tax preparation service or tax software: Tax preparation software and online filing services are options. These options are an easy way to complete and e-file your forms. Some software suppliers charge for their programs, Some are free. 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 aid: In most states, you can find volunteers to help prepare and e-file returns. However, eligibility for free aid is normally restricted based on earnings, and a few providers cater to specific demographic groups. The IRS maintains a database of licensed providers, but you should be aware this alternative is very likely to be the most costly one.
Using online tax preparation software is far and away the favored approach of the majority of taxpayers. In fact, the IRS says it expected more than four in five tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you may worry about security — especially 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 proven to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set security measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require ab sessions,” Chow says. “All this is routed over TLS encrypted connections”
It’s important to employ a trusted service to help you record your taxes. Chow advises not to e-file on a computer or utilize an internet connection that is not private.
For many taxpayers, it makes sense to e-file a yield because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices. Just make certain to use tax planning software from a dependable source, so that you may ensure the information you provide to transmit to the IRS will be kept secure.