Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree on everything, but they’re mostly on the same page in regards 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 save the IRS money because its workers don’t have 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 into your bank accounts.
However, what about safety? And can digital filing really provide you access to all the forms you may need if you have a intricate tax situation? Are there ever situations when you can not e-file? Let us 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 have been received: The IRS will confirm a tax filing was received within one day of electronic 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 may 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 can also accelerate the refund process.
Reduced chance of mistakes: According to 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 info on issues discovered on e-filed returns compared with paper returns.
Simple payment process: If you owe the IRS money, it’s easier to cover at your convenience when you e-file. You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. You also have the choice to pay your balance by making use of the IRS Direct pay service from the checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of taxation information: Submitting returns electronically means there is an electronic copy of your tax documents. If something happens to your paperwork, you’ll have a digital backup.
The good news: Most taxpayers do decide to e-file and find those benefits — and the process of doing this is easy.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you could be able to use the IRS Free File program. The forms do the math for you and offer standard guidance. You can only do your federal return with these kinds.
- Utilize an internet tax preparation service or tax 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 free. The program asks you simple questions about your own life and finances to guide you through the completion of your forms.
- Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields. But eligibility for free help is typically limited based on income, and a few providers cater to particular demographic groups. For example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a record of licensed providers, but be aware this alternative is very likely to be the most costly one.
Using online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it anticipated more than four tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you may be worried about security — especially with all these data breaches. But experts agree that this is not an issue which should dissuade you by e-filing.
“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 data 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 information secure. “Trainers normally use IRS particular APIs that require ab sessions,” Chow says. “All this is routed over TLS encrypted links “
It is important to employ a trustworthy service that will assist you record your taxes. Chow advises to not e-file on a computer or utilize an online connection which isn’t private.
For many taxpayers, it makes sense to e-file a yield since it is the most convenient way to submit 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 can ensure the information which you provide to transmit to the IRS will be kept secure.