Is e-filing a better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re largely on 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.
In return, you could find any refund you are owed faster, especially in the event that you have it directly deposited into your bank account.
But what about safety? And can digital filing actually provide you access to all of 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’s look at the advantages of e-filing, and whether it might be the best filing choice for your requirements.
If you are thinking about e-filing, a Few of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm 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 months to be given a tax refund. With e-filing, you are going to get your money in three weeks or not. Choosing direct deposit can also speed up the refund procedure.
Reduced likelihood of mistakes: According to the IRS, there is approximately a 1 percent error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Easy payment procedure: If you owe the IRS money, it’s easier to cover at your convenience when you e-file. You can submit returns early and pay afterwards if necessary, as long as you pay by 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, provided that the IRS receives your payment by Tax Day. You also have the option to pay your balance by using the IRS Immediate pay service from the checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) can lead to penalties and interest.
Digital storage of tax data: Submitting returns electronically means there is an electronic copy of your tax documents. So if something happens to your paperwork, you’ll have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the process of doing this is easy.
You have four options for filing an electronically filed tax return to the IRS.
Employing online tax prep software is far and away the preferred 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 secure?
While e-filing is convenient, you may worry about security — especially with so many data breaches. But experts agree that this isn’t a problem which should deter you from e-filing.
“In actuality, it can be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your data in the email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has set safety measures in place to keep your data secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted links .”
It’s important to employ a trustworthy service to assist you file your taxes. Chow advises to not e-file on a computer or utilize an internet connection which is not confidential.
For many taxpayers, it makes sense 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 choices. Just make sure to use tax planning software from a dependable source, so that you may make certain the information which you supply to transmit to the IRS is going to be kept protected.