Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re largely on the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is popular because it’s a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS cash because its workers don’t have to spend time manually processing your return. And in return, you can find any refund you are owed quicker, particularly if you have it directly deposited to your bank account.
However, what about security? And can digital filing really give you access to all the forms you may need if you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the benefits of e-filing, and whether it may be the very best filing choice for your needs.
If you are Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will confirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund. With e-filing, you’ll receive your money in 3 weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced chance of mistakes: In accordance with the IRS, there’s 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 procedure: If you owe the IRS money, it’s simpler to pay at your advantage if you e-file. It’s possible to submit returns early and pay afterwards if needed, provided that you pay by the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Immediate pay service from your checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can lead to interest and penalties.
Digital storage of tax information: Submitting returns electronically means there’s an electronic copy of your tax documents. If something happens to your paperwork, you’ll have a digital backup.
The good news: Most taxpayers do opt to e-file and get those benefits — and the process of doing this is easy.
Employing online tax preparation software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it expected over four in five tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could worry about security — particularly with all these data breaches. But experts agree that this isn’t a problem that should deter you by e-filing.
“In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted system as opposed to exposing your information in the email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has put safety measures in place to keep your information safe. “Trainers normally use IRS particular APIs that need ab sessions,” Chow says. “All this can be routed over TLS encrypted connections.”
It is important to use a trusted service that will help you record your taxes. Chow advises not to e-file on a public computer or use an internet connection which isn’t private.
For most 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 effortless payment choices. Just make sure to use tax preparation software from a dependable source, so you can ensure the information which you provide to transmit to the IRS is going to be kept secure.