Is e-filing a better way to record your taxes?
Americans and the IRS might not agree about 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 filed to the IRS are e-filed. E-filing is a favorite as it’s a win-win for taxpayers and the IRS.
In return, you can get any refund you’re owed quicker, especially in the event that you have it directly deposited to your bank account.
However, what about safety? And can electronic filing really give you access to all the forms that you might need if you have a complex tax situation? Are there situations when you can’t e-file? Let us look at the benefits of e-filing, and whether 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 received: The IRS will confirm a tax filing was received within one day of electronic submission. For paper filers, the IRS doesn’t 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 receive your money in 3 weeks or less. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of errors: According to the IRS, there’s around a 1% 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 returns compared with paper returns.
Simple payment process: If you owe the IRS money, it is simpler to pay 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. Additionally you have the option to pay your balance by using the IRS Direct pay service from your checking account 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 means there is a digital backup of your tax documents. If something happens to your paperwork, then you’ll have a digital 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 choices for filing an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the favored approach of most taxpayers. Actually, the IRS says it anticipated more than four in five tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you could worry about security — especially with so many data breaches. But experts agree this is not an issue which should deter you by e-filing.
“In fact, it may 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 mail.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted connections”
It’s very important to use a trustworthy service to assist you file your taxes. Chow advises not to e-file on a computer or use an online connection which is not private.
For many taxpayers, it is sensible 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 easy payment options. Just be sure to use tax planning software from a trusted source, so you may make certain the information you supply to transmit to the IRS is going to be kept protected.