Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they’re mostly on precisely the same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed. E-filing is popular because it is a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS money because its employees do not have to spend time manually processing your return. In return, you can find any refund you’re owed quicker, especially in the event that you have it directly deposited into your bank account.
But what about security? And can electronic filing actually give you access to all the forms that you may need if you have a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and whether it may be the very best filing choice for your needs.
If you are Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS does not send any acknowledgment 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 receive your money in 3 weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced likelihood of errors: In accordance with the IRS, there’s around a 1% error rate on e-filed yields, compared with a 20% speed of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it’s simpler to pay at your convenience if you e-file. It’s possible to submit returns early and pay later if needed, provided that you pay by 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, provided that the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by making use of the IRS Direct pay service from your checking account or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of taxation data: Submitting returns electronically implies there’s an electronic backup of your tax documents. If something happens to your paperwork, you’ll have a digital backup.
The good news: Most taxpayers do opt to e-file and get those advantages — and the practice of doing this is simple.
You have four options for submitting an electronically filed tax return to the IRS.
The types do the math for you and offer standard advice. You can simply do your federal return with all these forms.
Employing online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it anticipated over four tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you could be worried about security — particularly with all these data breaches. But experts agree that this isn’t a problem that should dissuade you by e-filing.
“In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has set security measures in place to keep your information safe. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is very important to employ a trusted service that will help you record your taxes. Chow advises not to e-file on a public computer or utilize an internet connection that 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 be certain to use tax planning software from a trusted source, so you may make certain the information which you provide to transmit to the IRS will be kept secure.