Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree on everything, but they’re mostly on precisely 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 a favorite as it is a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you save the IRS cash because its employees do not need to spend time manually processing your return. And in return, you can get any refund you’re owed faster, especially in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can electronic filing actually give you access to all the forms that you might need in case you’ve got a complex tax situation? Are there situations when you can not e-file? Let’s look at the advantages of e-filing, and if it may be the very best filing option for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms are 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 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 get your money in 3 weeks or not. Choosing direct deposit may also speed up the refund procedure.
Reduced likelihood of errors: According to 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 yields compared with paper returns.
Simple payment process: If you owe the IRS money, it’s easier to cover at your convenience when you e-file. It’s possible to submit returns early and pay later if necessary, 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 your checking account or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of tax information: Submitting returns electronically implies there’s an electronic backup of your tax records. If something happens to your paperwork, then you will have an electronic backup.
The good news: Most taxpayers do decide to e-file and find those benefits — and the process of doing this is simple.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program.
- Free File Fillable Types — If your income is more than $72,000 and you’re comfortable doing your taxes without help, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer basic advice. You can simply do your federal return with these forms.
- Utilize an internet tax preparation service or tax software: Tax preparation software and online filing services are alternatives. These choices are a simple way to complete and e-file your own forms. Some software providers charge for their apps, Some are free. The program asks you simple questions about your own life and finances to steer you through the completion of your forms.
- Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns. However, eligibility for free help is normally restricted based on earnings, and some services appeal to specific demographic groups.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this option is likely to be the most costly one.
Using online tax preparation software is far and away the favored approach of most taxpayers. In fact, the IRS says it anticipated more than four tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you could worry about security — especially with all these data breaches. But experts agree that this isn’t a problem that should deter you from e-filing.
“In fact, it may be more secure than paper filing since you’re sending your private information through an encrypted system as opposed to exposing your data in the email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS specific APIs that need ab sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is very important to use a trustworthy service that will help you record your taxes. Chow advises to not e-file on a public computer or use an internet connection which is not private.
For most taxpayers, it makes sense to e-file a yield since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment options. Just be certain that you use tax preparation software from a dependable source, so you may make certain the information which you supply to transmit to the IRS is going to be kept protected.