Is e-filing a better way to record 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 filed to the IRS are e-filed.
If you e-file your federal income tax return, you save the IRS money because its employees don’t have to spend time manually processing your return. In return, you can find any refund you are owed quicker, especially if you have it directly deposited into your bank accounts.
However, what about safety? And can electronic 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’t e-file? Let’s look at the advantages of e-filing, and whether it might be the very best filing option for your needs.
If you’re thinking about e-filing, a Few of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will affirm a tax filing has been received within 24 hours of digital submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived .
Timely refunds: When you publish a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit may also speed up the refund process.
Reduced chance of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% speed of errors on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.
Easy payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file. It’s possible to submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. Additionally you have the option to pay your balance by making use of the IRS Immediate pay service from your checking account 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) will lead to penalties and interest.
Digital storage of taxation information: Submitting returns electronically means there’s an electronic copy of your tax records. So if something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing this is easy.
Using online tax prep software is far and away the favored approach of the majority of taxpayers. In fact, the IRS says it anticipated over four tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you may worry about security — especially with so many data breaches. But experts agree that this is not a problem which should dissuade you from e-filing.
“In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your data in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted connections”
It’s very important to employ a trusted service to assist you record your taxes. Chow advises to not e-file on a public computer or use an internet connection that isn’t private.
For most taxpayers, it is sensible to e-file a return because 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 certain that you use tax preparation software from a dependable source, so that you can ensure the information you supply to transmit to the IRS is going to be kept protected.