Is e-filing a much better way to record your taxes?
Americans and the IRS might not agree on everything, but they are largely on 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.
If you e-file your federal income tax return, you save the IRS cash because its employees do not need to spend time manually processing your return. And in return, you could get any refund you are owed quicker, particularly in the event that you have it directly deposited to your bank account.
But what about security? And can digital filing really provide you access to all the forms that you may need if you’ve got a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it may be the best filing choice for your requirements.
If you’re thinking about e-filing, some of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will confirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely.
Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given 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 procedure.
Reduced chance of mistakes: In accordance with the IRS, there is approximately a 1 percent 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 returns.
Easy payment process: If you owe the IRS money, it is easier to cover at your advantage when you e-file. You can submit returns early and pay later if needed, provided that you pay from the April 15 filing deadline. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from the checking account or savings accounts, 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 result in interest and penalties.
Digital storage of tax data: Submitting returns electronically implies there is an electronic copy of your tax documents. If something happens to your paperwork, then you’ll have a digital backup.
The good news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is easy.
How to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you could have the ability to use the IRS Free File program. The types do the math for you and offer basic guidance. You can only do your federal return with these forms.
- Use an online tax preparation tax or service software: Tax preparation software and online filing services are alternatives. These choices are an easy way to complete and e-file your forms. Some applications suppliers charge for their programs, Some are liberated. The software asks you simple questions about your own life and financing to steer you through the completion of your forms.
- Get free, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields. However, eligibility for free aid is normally restricted based on income, and some services appeal to specific demographic groups. The IRS maintains a record of licensed providers, but be aware this option is very likely to be the most costly one.
Using online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it expected more than four tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you may be worried about security — especially with so many data breaches. But experts agree this is not a problem which should deter you from e-filing.
“In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set security measures in place to keep your data secure. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted links .”
It is very important to use a trusted service to help you file your taxes. Chow advises not to e-file on a public computer or use an online connection which isn’t 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 choices. Just be sure that you use tax planning software from a dependable source, so that you may ensure the information which you provide to transmit to the IRS is going to be kept protected.