Is e-filing a much better way to record your taxes?
Americans and the IRS may 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 filed to the IRS are e-filed. E-filing is a favorite as it is 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 don’t have to spend time manually processing your return. And in return, you can find any refund you’re owed faster, particularly in the event that you have it directly deposited to your bank account.
However, what about security? And can electronic filing actually provide you access to all of the forms that you might need in case you’ve got a intricate tax situation? Are there ever situations when you can’t e-file? Let’s look at the advantages of e-filing, and if it may be the best filing option for your requirements.
If you’re 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 one day of electronic submission. For paper filers, the IRS does not 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’ll get your money in three weeks or less. Choosing direct deposit may also speed up the refund process.
Reduced chance of mistakes: According to the IRS, there is approximately a 1 percent error rate on e-filed returns, compared with a 20% speed of errors on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Simple payment process: If you owe the IRS money, it’s simpler to cover at your advantage if you e-file. It’s possible to submit returns early and pay later if needed, as long as you pay by the April 15 filing deadline. Additionally you have the option to pay your balance by using the IRS Immediate 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.
Digital storage of tax information: Submitting returns electronically means there’s an electronic copy of your tax documents. If something happens to your paperwork, you’ll have a digital backup.
The good news: Most taxpayers do opt to e-file and get those benefits — and the process of doing this is easy.
The way to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
The types do the math for you and provide standard advice. You can only do your federal return with all these kinds.
Using online tax preparation software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it anticipated over four in five tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you may worry about safety — particularly with all these data breaches. But experts agree this isn’t an issue that should dissuade you by e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, marketing and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system as opposed to exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has set safety measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted connections.”
It is important to employ a trusted service that will help you record your taxes. Chow advises not to e-file on a computer or use an online connection that is not private.
For many taxpayers, it makes sense to e-file a yield because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment options. Just make sure to use tax planning software from a dependable source, so you can ensure the information which you supply to transmit to the IRS is going to be kept secure.