Is e-filing a much better way to file your taxes?
Americans and the IRS might not agree on everything, but they are mostly on 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.
And in return, you can get any refund you’re owed quicker, particularly in the event that you have it directly deposited into your bank accounts.
But what about safety? And can digital filing actually provide you access to all of the forms that you might need in case you have a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and whether 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 confirm a tax filing has been received within one day of digital 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 can take six to eight months to receive a tax refund. With e-filing, you are going to get your money in 3 weeks or not. Choosing direct deposit can also accelerate 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% rate of errors on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it is simpler to pay at your convenience if you e-file. It’s possible to submit returns early and pay afterwards if needed, provided that you pay by the April 15 filing deadline. And you can schedule electronic funds 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 option to pay your balance by making use of the IRS Direct pay service from your checking or savings accounts, 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 result in 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’ll have a digital backup.
The good news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing so is simple.
The way to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may have the ability to use the IRS Free File program. The forms do the math for you and offer standard guidance. You can simply do your federal return with these forms.
- Utilize an online tax preparation service or tax applications: Tax prep software and online filing services are alternatives. These choices are a simple way to complete and e-file your forms. Some applications providers charge for their apps, Some are liberated. The software asks you simple questions about your own life and financing to guide you through the completion of your types.
- Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns. However, eligibility for free aid is normally restricted based on earnings, and some services appeal to specific demographic groups. By way of instance, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re licensed IRS e-file providers. The IRS maintains a record of authorized providers, but you should be aware this alternative is likely to be the most costly one.
Employing online tax preparation software is far and away the favored approach of most taxpayers. In fact, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you may be worried about safety — particularly with so many data breaches. But experts agree this isn’t an issue that should dissuade you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and sales at LegalShield. “In actuality, it may be more secure than paper filing as 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, explains that the IRS has put safety measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It’s important to employ a trustworthy service that will help you file your taxes. Chow advises not to e-file on a computer or use an online connection that is not confidential.
For many taxpayers, it makes sense to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be certain that you use tax planning software from a dependable source, so you may ensure the information which you provide to transmit to the IRS is going to be kept secure.