Is e-filing a better way to record your taxes?
Americans and the IRS might not agree about everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.
Nearly all 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.
In return, you can get any refund you are owed quicker, particularly if you have it directly deposited to your bank accounts.
But what about security? And can electronic filing really provide you access to all the forms you may need if you’ve got a complex tax situation? Are there ever 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 are thinking about e-filing, a Few of the advantages include:
- Quick affirmation your forms have been 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 .
Timely refunds: When you publish a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit may also speed up the refund procedure.
Reduced likelihood of mistakes: In accordance with the IRS, there is approximately a 1% 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 returns compared with paper returns.
Easy payment procedure: If you owe the IRS money, it’s simpler to cover at your advantage if you e-file. It’s possible to submit returns early and pay afterwards if needed, as long as you pay by the April 15 filing deadline. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from the checking account or savings accounts, filing 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) will result in penalties and interest.
Digital storage of tax data: Submitting returns electronically implies there is an electronic backup of your tax documents. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the process of doing this is simple.
The way to e-file a tax return?
You have four options for submitting an electronically filed tax return to the IRS.
The types do the math for you and provide standard guidance. You can simply do your federal return with all these forms.
Using online tax preparation software is far and away the favored approach of most taxpayers. In fact, the IRS says it expected over four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you may worry about security — especially with all these data breaches. But experts agree this isn’t a problem that should deter you by e-filing.
“In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has set security measures in place to keep your data safe. “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It’s very important to employ a trusted service that will help you record your taxes. Chow advises to not e-file on a public computer or utilize an internet connection that isn’t private.
For most taxpayers, it is sensible to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment options. Just make certain to use tax preparation software from a trusted source, so you may ensure the information which you provide to transmit to the IRS is going to be kept protected.