Is e-filing really a much better way to file your taxes?
Americans and the IRS may not agree on everything, but they are largely on precisely 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.
When you e-file your federal income tax return, you conserve the IRS cash because its workers do not need to spend time manually processing your return. In return, you can get any refund you are owed faster, especially in the event that you have it directly deposited to your bank account.
However, what about security? And can electronic filing actually give you access to all of the forms that you might need in case you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and if it may be the best filing option for your needs.
If you’re Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will affirm a tax filing was received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment 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 are going to receive your money in 3 weeks or less. Choosing direct deposit can also speed up the refund procedure.
Reduced chance of errors: According to the IRS, there is approximately a 1% error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed returns compared with paper yields.
Easy payment process: If you owe the IRS money, it’s simpler to cover at your convenience 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. You also have the choice to pay your balance by making use of the IRS Direct pay service from the checking or savings account, filing 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 result in interest and penalties.
Digital storage of tax information: Submitting returns electronically implies there’s a digital backup of your tax records. If something happens to your paperwork, you’ll have an electronic backup.
The good news: Most taxpayers do decide to e-file and get those benefits — and the process of doing so is simple.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you may have the ability to use the IRS Free File program.
- Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your earnings without help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide standard advice. You can simply do your federal return with all these kinds.
- Utilize an online tax preparation service or tax applications: Tax prep software and online filing services are alternatives. These choices are a simple way to complete and e-file your forms. Some software providers charge for their programs, Some are liberated. The software asks you simple questions about your life and financing to guide you through the completion of your types.
- Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns. However, eligibility for free aid is typically limited based on income, and some providers cater 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.
Employing online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it expected over four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you may be worried about security — particularly with so many data breaches. But experts agree that this isn’t an issue which should dissuade you from e-filing.
“In actuality, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has put safety measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All this is routed over TLS encrypted connections”
It is important to use a trusted service that will 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 many taxpayers, it makes sense to e-file a yield 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 that you use tax planning software from a trusted source, so you can make certain the information which you provide to transmit to the IRS is going to be kept secure.