Is e-filing a better way to file your taxes?
Americans and the IRS may not agree on everything, but they’re largely on precisely the same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed. E-filing is a favorite as it is a win-win for taxpayers and the IRS.
And in return, you could find any refund you’re owed quicker, particularly in the event that you have it directly deposited to your bank accounts.
But what about safety? And can electronic filing really provide you access to all of the forms you may need if you have a intricate tax situation? Are there situations when you can’t e-file? Let’s look at the benefits of e-filing, and if it may be the very best filing option for your needs.
If you are thinking about e-filing, some of the advantages include:
- Quick affirmation your forms have been received: The IRS will affirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
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 get your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced likelihood of mistakes: In accordance with the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper returns.
Easy payment procedure: If you owe the IRS money, it is easier to pay at your convenience when you e-file. You can submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline. And you’re able to schedule electronic money transfers to easily send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. You also have the choice to pay your balance by using 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.
Digital storage of tax data: Submitting returns electronically implies there’s an electronic backup of your tax records. If something happens to your paperwork, you’ll have a digital backup.
The good news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing so is simple.
You have four options for filing an electronically filed tax return to the IRS.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may be able to use the IRS Free File program.
- Free File Fillable Forms — If your income is more than $72,000 and you’re comfortable doing your taxes without any help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide basic advice. You can only do your federal return with all these forms.
- Use an online tax preparation service or tax software: Tax prep software and online filing services are options. These choices are an easy way to finish and e-file your forms. Some applications providers charge for their apps, Some are free. The program asks you simple questions about your life and financing 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 returns. But eligibility for free aid is normally restricted based on income, and some services appeal to particular demographic groups. For instance, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older. The IRS maintains a record of licensed providers, but be aware this option is very likely to be the most costly one.
Employing online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it expected over four in five tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you may worry about safety — particularly with so many data breaches. But experts agree this isn’t a problem that should dissuade you by e-filing.
“In fact, it may be more secure than paper filing as you’re sending your personal information through an encrypted system rather than exposing your data in the email.”
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. “Vendors typically utilize IRS particular APIs that require ab sessions,” Chow says. “All this can be routed over TLS encrypted connections”
It is important to use a trustworthy service that will assist you record your taxes. Chow advises to not e-file on a public computer or use an internet connection that is not private.
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 sure to use tax preparation software from a dependable source, so you can make certain the information you provide to transmit to the IRS will be kept protected.