Is e-filing a better way to record your taxes?
Americans and the IRS might not agree on everything, but they’re largely 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 save the IRS money because its employees do not have to spend time manually processing your return. And in return, you can get any refund you are owed quicker, particularly if you have it directly deposited to your bank account.
However, what about safety? And can electronic filing actually provide you access to all the forms you might need if you have a complex tax situation? Are there situations when you can not e-file? Let us look at the benefits of e-filing, and whether it might be the best filing choice for your needs.
If you’re Considering e-filing, a Few of the advantages include:
- Quick confirmation your forms are obtained: The IRS will affirm 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 .
Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given a tax refund. With e-filing, you are going to get your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced chance of errors: According to the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed yields compared with paper yields.
Easy payment process: If you owe the IRS money, it’s easier to cover at your advantage if you e-file. It’s possible to submit returns early and pay later if needed, provided that you pay from the April 15 filing deadline. And you’re able to schedule electronic funds transfers to easily send the IRS what you owe on a date of your choosing — again, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from your checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of taxation data: Submitting returns electronically implies there is a digital copy of your tax documents. If something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the process of doing this is simple.
How to e-file a tax return?
You have four options for submitting an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it expected over four tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you may be worried about security — especially with all these data breaches. But experts agree that this isn’t a problem that should dissuade you by e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, marketing and sales at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted network as opposed to exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set safety measures in place to keep your information safe. “Trainers normally use IRS specific APIs that require ab sessions,” Chow says. “All this is routed over TLS encrypted links “
It is important to use a trusted service to help you record your taxes. Chow advises not to e-file on a public computer or utilize an internet connection that is not 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 be certain to use tax preparation software from a trusted source, so you may ensure the information which you provide to transmit to the IRS will be kept secure.