Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree on everything, but they’re largely on precisely the exact 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.
And in return, you could get any refund you are owed faster, especially in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can electronic filing actually give you access to all of the forms that you might need if you have a complex tax situation? Are there ever situations when you can’t e-file? Let’s look at the benefits of e-filing, and whether it might be the 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 was received within one day of electronic 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 weeks to be given a tax refund. With e-filing, you’ll get your money in 3 weeks or less. Choosing direct deposit can also speed up the refund procedure.
Reduced chance of mistakes: According to the IRS, there is approximately 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 returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it is easier to cover at your advantage when you e-file. You can submit returns early and pay afterwards if needed, provided that you pay by 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, provided that the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by using the IRS Direct pay service from the checking account or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can result in penalties and interest.
Digital storage of taxation information: Submitting returns electronically means there is a digital backup of your tax documents. If something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing this is easy.
Employing online tax prep software is far and away the favored approach of the majority of taxpayers. In fact, the IRS says it anticipated more than 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 — especially with all these data breaches. But experts agree that this isn’t a problem which should dissuade you from e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your information 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 data secure. “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says. “All this is routed over TLS encrypted links .”
It is very important to use a trusted service to help you file your taxes. Chow advises not to e-file on a public computer or use an internet connection that is not confidential.
For most taxpayers, it makes sense 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 sure that you use tax preparation software from a trusted source, so that you can ensure the information you supply to transmit to the IRS will be kept secure.