Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree about everything, but they’re mostly on the exact same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
If you e-file your federal income tax return, you conserve the IRS cash because its employees do not need to spend time manually processing your return. In return, you could get any refund you’re owed faster, especially in the event that you have it directly deposited to your bank accounts.
However, what about security? And can digital filing really give you access to all of the forms you might need in case you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let’s look at the advantages of e-filing, and whether it might be the very best filing choice for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been obtained: 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 may take six to eight months to receive a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit can also accelerate the refund process.
Reduced likelihood of errors: In accordance with the IRS, there is approximately a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper yields.
Easy payment procedure: 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 afterwards if needed, provided that you pay from the April 15 filing deadline. Additionally you have the choice to pay your balance by making use of the IRS Immediate pay service from your checking or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax information: Submitting returns electronically implies there is an electronic copy of your tax documents. So if something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and find those benefits — and the practice of doing so is simple.
Using online tax prep software is far and away the favored approach of most taxpayers. Actually, the IRS says it anticipated over four tax returns to be submitted through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you may worry about security — especially with so many data breaches. But experts agree this is not an issue which should dissuade you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your private information through an encrypted network as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS particular APIs that need token sessions,” Chow says. “All this is routed over TLS encrypted connections.”
It is important to employ a trustworthy service that will help you record your taxes. Chow advises not to e-file on a computer or utilize an internet connection that is not confidential.
For many taxpayers, it is sensible to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just make certain to use tax planning software from a trusted source, so that you can ensure the information you supply to transmit to the IRS will be kept secure.