Jack Canfield Blog – Should I E-file My Taxes Online

Is e-filing really a better way to record your taxes? 

Americans and the IRS may not agree about everything, but they’re largely on precisely the 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 a favorite because it is a win-win for taxpayers and the IRS.

And in return, you can get any refund you’re owed quicker, particularly in the event that you have it directly deposited to your bank accounts.

But what about security?  And can digital filing really give you access to all the forms that you might need if you have a complex tax situation?  Are there ever situations when you can not e-file?  Let us look at the advantages of e-filing, and if it might be the very best filing choice for your requirements.

If you’re Considering e-filing, some of the advantages include:

  1. Quick affirmation 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 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 accelerate the refund process.

  2. Reduced chance of errors: According to the IRS, there’s around a 1% 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 yields.

  3. Simple payment procedure: If you owe the IRS money, it’s easier to pay at your advantage if you e-file.  It’s possible to submit returns early and pay later if necessary, 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 Direct pay service from your checking or savings account, filing 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) can result in interest and penalties.

  4. Digital storage of taxation information: Submitting returns electronically implies there’s an electronic backup of your tax records.  If something happens to your paperwork, you’ll have an electronic backup.

The good news: Most taxpayers do opt to e-file and get those advantages — and the process of doing so is easy.

    1. Utilize 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 provide basic advice.  You can simply do your federal return with these kinds. 
    2. Use an internet tax preparation service or tax software: Tax prep software and online filing services are alternatives.  These choices are a simple way to finish and e-file your own forms.  Some software suppliers charge for their programs, Some are free.   The program asks you simple questions about your life and finances to guide you through the completion of your types.  
    3. Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on earnings, and a few services appeal to specific demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.  The IRS maintains a record of authorized providers, but be aware this option is very likely to be the most costly one. 

Employing online tax preparation software is far and away the preferred approach of the majority of taxpayers.  Actually, the IRS says it expected over four tax returns to be filed through tax return prep program.

Is e-filing really stable?

While e-filing is suitable, you could worry about security — particularly with all these data breaches.  But experts agree this is not a problem that should dissuade you by e-filing.

“In actuality, 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 information security at SCIS Security, explains the IRS has put safety measures in place to keep your data safe.  “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says.  “All of this can be routed over TLS encrypted links “

It is important to use a trustworthy service that will assist you record your taxes.  Chow advises not to e-file on a public computer or use an online connection which isn’t confidential.

Bottom line

For many taxpayers, it makes sense to e-file a yield since it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options.  Just make sure that you use tax preparation software from a dependable source, so you may make certain the information you supply to transmit to the IRS is going to be kept secure.