Is e-filing really a better way to file your taxes?
Americans and the IRS may not agree on everything, but they’re largely on precisely the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is popular as it’s a win-win for taxpayers and the IRS.
And in return, you can get any refund you are owed faster, particularly in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can digital filing really give you access to all of the forms you might need if you’ve got a complex tax situation? Are there situations when you can’t e-file? Let’s look at the advantages of e-filing, and whether it may be the best filing option for your needs.
If you’re thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing was received within one day of digital 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 months to be given a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit may also speed up the refund process.
Reduced chance of errors: In accordance with the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more info on issues discovered on e-filed returns compared with paper yields.
Easy payment process: If you owe the IRS money, it is simpler to cover at your advantage if you e-file. You can submit returns early and pay afterwards if needed, as long as you pay from the April 15 filing deadline. Additionally you have the option to pay your balance by using 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.
Digital storage of taxation data: Submitting returns electronically means there’s an electronic copy of your tax documents. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic 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?
- 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 types do the math for you and provide basic advice. You can only do your federal return with these forms.
- Utilize an online tax preparation service or tax applications: Tax preparation software and online filing services are alternatives. These options are an easy way to complete and e-file your own forms. Some software providers charge for their programs, Some are liberated. The program asks you simple questions about your life and financing to steer you through the completion of your types.
- Get complimentary, in-person tax aid: In most states, you will 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 particular demographic groups. The IRS maintains a database of licensed providers, but be aware this option is likely to be the most costly one.
Employing online tax prep software is far and away the preferred approach of the majority of taxpayers. In fact, 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 convenient, you may worry about security — especially with all these data breaches. But experts agree this is not an issue which should dissuade you from e-filing.
“In fact, it may be more secure than paper filing as you’re sending your personal information through an encrypted system as opposed to exposing your data in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has put security measures in place to keep your information safe. “Trainers normally use IRS particular APIs that need ab sessions,” Chow says. “All of this is routed over TLS encrypted links “
It’s important to use a trustworthy service that will help you record your taxes. Chow advises not to 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 since it is 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 that you use tax planning software from a trusted source, so you can make certain the information you provide to transmit to the IRS will be kept protected.