Is e-filing a much better way to record your taxes?
Americans and the IRS might not agree about everything, but they are mostly on precisely the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
And in return, you can find any refund you are owed quicker, particularly in the event that you have it directly deposited into your bank account.
But what about security? And can digital filing actually give you access to all of the forms that you might need if you’ve got a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and if it might be the best filing option for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will confirm a tax filing has been received within 24 hours of electronic submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
Timely refunds: When you submit a paper filing, it may 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 less. Choosing direct deposit can also speed up the refund process.
Reduced likelihood of mistakes: According to the IRS, there is approximately a 1 percent error rate on e-filed yields, compared with a 20% rate of errors on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper returns.
Simple payment process: If you owe the IRS money, it’s easier to pay at your convenience when you e-file. You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline. And you can schedule electronic money transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by making use of the IRS Direct pay service from the checking or savings accounts, filing 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 means there is a digital copy of your tax documents. If something happens to your paperwork, 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 this is simple.
You have four options for submitting an electronically filed tax return to the IRS.
- Use 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 forms do the math for you and provide standard advice. You can simply do your federal return with all these kinds.
- Use an online tax preparation tax or service software: Tax prep software and online filing services are alternatives. These choices are an easy way to complete and e-file your own forms. Some applications suppliers charge for their programs, Some are liberated. The program asks you simple questions about your life and finances to guide you through the completion of your forms.
- Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields. But eligibility for free aid is typically limited based on income, and a few services appeal to specific demographic groups. 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 favored approach of most taxpayers. In fact, the IRS says it expected over four tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you could worry about safety — especially with so many data breaches. But experts agree that this is not an issue which should deter you by e-filing.
“In fact, it can be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set security measures in place to keep your data secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All this is routed over TLS encrypted connections.”
It is very important to employ a trusted service to assist you file your taxes. Chow advises to not e-file on a public computer or use an internet connection which isn’t confidential.
For many taxpayers, it makes sense to e-file a return because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just be sure to use tax preparation software from a dependable source, so that you can ensure the information you provide to transmit to the IRS will be kept secure.