Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re 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. E-filing is a favorite because 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. And in return, you can find any refund you are owed faster, especially if you have it directly deposited into your bank accounts.
But what about safety? And can electronic filing actually give you access to all of the forms that you might need in case you have a intricate 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’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms are received: The IRS will affirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it can take six to eight weeks to receive a tax refund. With e-filing, you are going to get your money in 3 weeks or less. Choosing direct deposit may also accelerate the refund process.
Reduced likelihood of errors: According to the IRS, there is around a 1% error rate on e-filed returns, 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 yields.
Simple payment procedure: If you owe the IRS money, it is simpler to pay at your convenience if you e-file. It’s possible to submit returns early and pay later if needed, as long as you pay by the April 15 filing deadline. Additionally you have the option to pay your balance by making use of the IRS Immediate pay service from the checking or savings accounts, submitting 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 records. So if something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing so is simple.
Using online tax preparation software is far and away the favored approach of the majority of taxpayers. In fact, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could be worried about security — particularly with all these data breaches. But experts agree that this isn’t a problem which should deter you from e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “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 information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has put safety measures in place to keep your data secure. “Trainers normally use IRS particular APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted links .”
It’s important to use a trustworthy service that will help you file your taxes. Chow advises to not e-file on a public computer or use an online connection which is not private.
For many taxpayers, it is sensible to e-file a return because 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 trusted source, so that you can make certain the information you supply to transmit to the IRS is going to be kept protected.