Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree about everything, but they are mostly on precisely the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed. E-filing is a favorite because it’s a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS cash because its employees don’t have to spend time manually processing your return. In return, you can get any refund you are owed quicker, especially in the event that you have it directly deposited to your bank accounts.
But what about safety? And can digital filing actually give you access to all of the forms you might need in case you have a intricate tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and if it might be the very best filing choice for your requirements.
If you’re Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms are received: The IRS will affirm a tax filing has been received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived .
Timely refunds: When you submit a paper filing, it may take six to eight months to be given a tax refund. With e-filing, you’ll receive your money in 3 weeks or less. Choosing direct deposit can also speed up the refund procedure.
Reduced chance of errors: In accordance with the IRS, there is around 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 returns.
Simple payment process: If you owe the IRS money, it is simpler to cover at your advantage if you e-file. You can submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline. And you can schedule electronic money transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by making use of the IRS Immediate pay service from your checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) can lead to penalties and interest.
Digital storage of tax information: Submitting returns electronically means there is an electronic copy of your tax records. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the practice of doing so is easy.
Employing online tax preparation software is far and away the favored approach of most taxpayers. Actually, the IRS says it anticipated over four in five tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you may be worried about security — particularly with so many data breaches. But experts agree this is not a problem which should deter you by e-filing.
“In fact, it may be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has put safety measures in place to keep your data secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted links “
It is important to use a trustworthy service to assist you file your taxes. Chow advises not to e-file on a public computer or use an internet connection which is not private.
For many taxpayers, it is sensible to e-file a return 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 certain that you use tax planning software from a dependable source, so you can ensure the information which you provide to transmit to the IRS will be kept protected.