Is e-filing a much better way to record your taxes?
Americans and the IRS may not agree about everything, but they are mostly on the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
And in return, you could get any refund you are owed quicker, particularly in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can digital filing actually give you access to all the forms you might need in case you’ve got a intricate tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it may be the very best filing choice for your requirements.
If you’re Considering e-filing, a Few of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will affirm a tax filing has been received within 24 hours of electronic 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 can 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 may also speed up 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 errors on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper yields.
Easy payment process: If you owe the IRS money, it is easier to pay at your convenience if you e-file. You can submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Direct pay service from the checking or savings account, filing 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 penalties and interest.
Digital storage of tax data: Submitting returns electronically implies there is a digital copy of your tax records. If something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing so is simple.
You have four choices for submitting an electronically filed tax return to the IRS.
The forms do the math for you and offer standard advice. You can only do your federal return with these forms.
Using online tax prep software is far and away the preferred approach of most taxpayers. Actually, the IRS says it anticipated more than four in five tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you may be worried about safety — particularly with so many data breaches. But experts agree this isn’t a problem which should deter you by e-filing.
“In fact, 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 mail.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS particular APIs that require token sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It’s very important to employ a trustworthy service that will assist you file your taxes. Chow advises not to e-file on a computer or utilize an online connection which isn’t private.
For many taxpayers, it makes sense to e-file a return since it’s the most convenient way to file 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 trusted source, so that you can make certain the information which you provide to transmit to the IRS will be kept secure.