Is e-filing really a much better way to file your taxes?
Americans and the IRS might not agree about everything, but they’re largely on the exact 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. E-filing is a favorite as it’s a win-win for taxpayers and the IRS.
And in return, you can get any refund you’re owed faster, especially in the event that you have it directly deposited to your bank account.
But what about security? And can electronic filing actually provide you access to all of the forms that you may need if you have a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it might be the best filing option for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms are received: The IRS will confirm a tax filing has been received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you publish a paper filing, it can take six to eight months to receive a tax refund. With e-filing, you are going to receive your money in three weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced likelihood of errors: 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 information on issues discovered on e-filed returns compared with paper returns.
Easy payment process: If you owe the IRS money, it’s simpler to pay at your convenience if 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 using the IRS Immediate pay service from your checking or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of taxation information: Submitting returns electronically means there’s an electronic backup of your tax records. So if something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and find those advantages — and the process of doing this is simple.
You have four options for submitting an electronically filed tax return to the IRS.
The forms do the math for you and offer standard advice. You can simply do your federal return with these kinds.
Using online tax prep software is far and away the favored approach of most taxpayers. Actually, the IRS says it anticipated more than four tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you may be worried about safety — especially with all these data breaches. But experts agree that this is not a problem which should deter you from e-filing.
“In fact, it may be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has put security measures in place to keep your data safe. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All this is routed over TLS encrypted connections”
It’s very important to use a trustworthy service that will help you file your taxes. Chow advises to not e-file on a computer or utilize an online connection which is not confidential.
For most taxpayers, it is sensible to e-file a return since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options. Just make certain that you use tax planning software from a dependable source, so that you can make certain the information you supply to transmit to the IRS will be kept protected.