Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed. E-filing is popular as it is a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS cash because its employees don’t have to spend time manually processing your return. And in return, you could find any refund you’re owed faster, especially if you have it directly deposited to your bank account.
However, what about safety? And can electronic filing really provide you access to all of the forms that you may need in case 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 if it might be the best filing option for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will confirm a tax filing was received within 24 hours 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 may take six to eight months to be given a tax refund. With e-filing, you’ll receive your money in 3 weeks or less. Choosing direct deposit may also accelerate the refund procedure.
Reduced likelihood of errors: According to the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed returns compared with paper returns.
Easy payment procedure: If you owe the IRS money, it is simpler to cover at your advantage when 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. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from the checking account or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically means there is a digital copy of your tax documents. So if something happens to your paperwork, then you’ll have a digital backup.
The good news: Most taxpayers do opt to e-file and find those benefits — and the practice of doing this is easy.
The way to e-file a tax return?
Employing online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it anticipated over four tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you may worry about security — especially with all these data breaches. But experts agree this is not an issue which should dissuade you by e-filing.
“In actuality, it can be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has set safety measures in place to keep your data secure. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All this is routed over TLS encrypted links “
It is important to employ a trusted service that will assist you file your taxes. Chow advises to not e-file on a public computer or utilize an online connection that is not confidential.
For many taxpayers, it is sensible to e-file a return because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices. Just make sure to use tax preparation software from a trusted source, so you can ensure the information which you supply to transmit to the IRS will be kept protected.