Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree on everything, but they’re mostly on precisely the same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
And in return, you could get any refund you are owed quicker, particularly if you have it directly deposited into your bank account.
But what about security? And can electronic filing actually provide you access to all the forms that you might need if you have a complex tax situation? Are there situations when you can not e-file? Let’s look at the advantages of e-filing, and whether it might be the best filing option for your needs.
If you are thinking about e-filing, some of the advantages include:
- Quick affirmation your forms are received: The IRS will affirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
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 three weeks or less. Choosing direct deposit can also speed up the refund process.
Reduced likelihood of mistakes: According to the IRS, there’s around a 1% error rate on e-filed yields, compared with a 20% speed of errors on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.
Easy payment procedure: If you owe the IRS money, it is simpler to cover at your advantage when you e-file. You can 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 making use of the IRS Direct pay service from your checking account or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) will lead to penalties and interest.
Digital storage of taxation information: Submitting returns electronically means there is an electronic copy of your tax records. If something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing so is easy.
How to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program. The forms do the math for you and provide standard advice. You can simply do your federal return with these kinds.
- Utilize an online tax preparation tax or service software: Tax preparation software and online filing services are options. These choices are a simple way to finish and e-file your forms. Some applications providers charge for their apps, Some are free. The software asks you simple questions about your own life and finances to guide you through the completion of your forms.
- Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields. However, eligibility for free help is typically limited based on earnings, and some providers appeal to specific demographic groups. The IRS maintains a database of authorized providers, but you should be aware this alternative is likely to be the most costly one.
Using online tax prep software is far and away the favored approach of most taxpayers. Actually, 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 convenient, you could be worried about safety — especially with all these data breaches. But experts agree that this is not 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 rather than exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has set security measures in place to keep your data secure. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All of this is routed over TLS encrypted links “
It is very important to employ a trustworthy service to help you file your taxes. Chow advises to not e-file on a public computer or use an internet connection which isn’t confidential.
For most 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 easy payment choices. Just make certain to use tax preparation software from a dependable source, so that you may ensure the information which you supply to transmit to the IRS will be kept protected.