Is e-filing a much better way to record your taxes?
Americans and the IRS may not agree about everything, but they are mostly 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.
And in return, you can find any refund you are owed faster, particularly if you have it directly deposited into your bank account.
However, what about safety? And can digital filing actually provide you access to all the forms that you might need in case you have a complex tax situation? Are there ever situations when you can not e-file? Let us look at the benefits of e-filing, and if it might be the best filing option for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will affirm a tax filing has been received within one day of electronic 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 months to be given a tax refund. With e-filing, you are going to get your money in 3 weeks or not. Choosing direct deposit can also speed up the refund procedure.
Reduced chance of mistakes: According to the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper yields.
Easy 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 afterwards if necessary, as long as you pay from the April 15 filing deadline. Additionally you have the choice to pay your balance by making use of the IRS Immediate pay service from the checking account or savings account, filing a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) will result in interest and penalties.
Digital storage of tax data: Submitting returns electronically means there is an electronic backup of your tax documents. If something happens to your paperwork, 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 so is simple.
The way to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
The forms do the math for you and provide basic advice. You can only do your federal return with all these kinds.
Using online tax prep software is far and away the favored approach of most taxpayers. In fact, the IRS says it anticipated more than four in five tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you may be worried about safety — especially with all these data breaches. But experts agree that this isn’t a problem that should deter you by e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and sales at LegalShield. “In fact, it may be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has set security measures in place to keep your information secure. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is important to employ a trustworthy service to help you file your taxes. Chow advises not to e-file on a public computer or utilize an online connection which is not confidential.
For many 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 options. Just make sure that you use tax preparation software from a trusted source, so you may ensure the information which you supply to transmit to the IRS will be kept secure.