Is e-filing really a much better way to file your taxes?
Americans and the IRS may not agree about everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
In return, you can get any refund you’re owed faster, especially if you have it directly deposited to your bank account.
However, what about safety? And can digital filing really provide you access to all of the forms you may need if you have a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the benefits of e-filing, and if it may be the very best filing option for your requirements.
If you are thinking about e-filing, a Few of the advantages include:
- Quick confirmation your forms are received: The IRS will confirm a tax filing was received within one day of digital 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 can take six to eight months to receive a tax refund. With e-filing, you are going to receive your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced chance of mistakes: According to the IRS, there’s 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 information on problems discovered on e-filed yields compared with paper yields.
Simple payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file. You can submit returns early and pay later if needed, provided that you pay by the April 15 filing deadline. And you’re able to schedule electronic funds 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. You also have the option to pay your balance by making use of the IRS Direct pay service from the checking account or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of taxation information: Submitting returns electronically means there is a digital backup of your tax records. If something happens to your paperwork, then you’ll have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing so is simple.
How 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 not as you could have the ability 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 earnings without any help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide standard guidance. You can simply do your federal return with all these kinds.
- Utilize an internet tax preparation tax or service applications: Tax prep software and online filing services are options. These choices are a simple way to complete and e-file your forms. Some software providers charge for their apps, Some are liberated. The program asks you simple questions about your own life and financing to guide you through the completion of your types.
- Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns. But eligibility for free help is normally restricted based on income, and some services appeal to specific demographic groups. For instance, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they’re licensed IRS e-file providers. The IRS maintains a database of authorized providers, but you should be aware this option is likely to be the most costly one.
Using online tax preparation software is far and away the favored approach of most taxpayers. In fact, the IRS says it anticipated more than four tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could be worried about security — particularly with all these data breaches. But experts agree this is not an issue that should deter you from e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has put safety measures in place to keep your information secure. “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is very important to use a trusted service that will assist you record your taxes. Chow advises to not e-file on a computer or utilize an internet connection which isn’t private.
For most taxpayers, it is sensible to e-file a return because 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 sure that you use tax preparation software from a trusted source, so that you may ensure the information you supply to transmit to the IRS will be kept secure.