Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree about everything, but they’re largely on precisely the 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’s a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you conserve the IRS cash because its employees don’t need to spend time manually processing your return. In return, you can get any refund you are owed quicker, especially in the event that you have it directly deposited to your bank accounts.
But what about security? And can electronic filing actually give you access to all of the forms that you may need if you have a intricate tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and if it might be the very best filing choice for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick affirmation your forms are received: The IRS will confirm a tax filing was received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
Timely refunds: When you submit a paper filing, it can take six to eight weeks to receive 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 process.
Reduced likelihood of errors: According to the IRS, there is approximately a 1 percent error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed returns compared with paper returns.
Simple payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file. It’s possible to submit returns early and pay afterwards if necessary, provided that you pay by the April 15 filing deadline. And you’re able to 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. You also have the option to pay your balance by making use of the IRS Immediate pay service from the checking or savings account, 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 a digital backup of your tax documents. So if something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing so is simple.
How to e-file a tax return?
- Utilize 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 offer standard advice. You can simply do your federal return with these forms.
- Utilize an internet tax preparation tax or service software: Tax prep software and online filing services are alternatives. These choices are a simple way to finish and e-file your forms. Some software providers charge for their apps, Some are liberated. The software asks you simple questions about your own life and financing to guide 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. But eligibility for free aid is typically limited based on earnings, and a few services appeal to specific demographic groups. By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. The IRS maintains a record of authorized providers, but be aware this option is very likely to be the most costly one.
Using online tax prep software is far and away the favored approach of most taxpayers. Actually, the IRS says it anticipated over four tax returns to be filed through tax return prep program.
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 that should deter you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has set security measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links “
It is very important to use a trustworthy service to help you record your taxes. Chow advises not to e-file on a public computer or utilize an internet connection which is not confidential.
For many taxpayers, it is sensible to e-file a yield because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options. Just be sure to use tax preparation software from a dependable source, so you can make certain the information which you supply to transmit to the IRS will be kept protected.