Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree on everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed.
When you e-file your federal income tax return, you conserve 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 quicker, particularly in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can digital filing actually provide you access to all of the forms that you might need if you’ve got a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and whether it might be the very best filing option for your requirements.
If you’re Considering e-filing, a Few of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing was received within one day of electronic submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely.
Timely refunds: When you publish a paper filing, it can take six to eight weeks to be given a tax refund. With e-filing, you are going to receive your money in 3 weeks or less. Choosing direct deposit may also speed up the refund process.
Reduced chance of errors: According to the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% speed of errors on paper filings. The IRS also provides more information on issues discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it’s easier to pay at your convenience if you e-file. It’s possible to submit returns early and pay later if needed, provided that you pay by 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, 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 Immediate pay service from your checking or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can lead to interest and penalties.
Digital storage of tax information: Submitting returns electronically means there’s a digital copy of your tax documents. If something happens to your paperwork, then you will have an electronic backup.
The good news: Most taxpayers do opt to e-file and get those advantages — and the practice of doing so is simple.
How to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you may have the ability to use the IRS Free File program. The types do the math for you and provide basic guidance. You can simply do your federal return with these kinds.
- Use an online tax preparation tax or service applications: Tax prep software and online filing services are options. These choices are an easy way to complete and e-file your own forms. Some software providers charge for their apps, Some are free. The software asks you simple questions about your life and finances to guide 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 typically limited based on earnings, and some services cater to particular demographic groups.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are authorized IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this alternative is very likely to be the most costly one.
Employing online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it expected more than four tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you could worry about security — particularly with so many data breaches. But experts agree that this isn’t a problem which 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 system as opposed to exposing your data in the email.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has set security measures in place to keep your data safe. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It’s important to employ a trustworthy service to assist you record your taxes. Chow advises not to e-file on a computer or use an online connection which isn’t private.
For many taxpayers, it is sensible to e-file a return 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 that you use tax planning software from a trusted source, so that you may ensure the information you provide to transmit to the IRS will be kept protected.