Is e-filing a much better way to record your taxes?
Americans and the IRS may not agree about everything, but they are mostly on precisely the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is popular because it is a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you save the IRS money because its workers don’t need to spend time manually processing your return. And in return, you can find any refund you are owed faster, especially if you have it directly deposited into your bank account.
But what about safety? And can electronic filing actually provide you access to all the forms that you might need in case you’ve got 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 may be the very best filing choice for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will confirm a tax filing was received within one day of digital submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived .
Timely refunds: When you submit a paper filing, it can take six to eight weeks to be given a tax refund. With e-filing, you’ll receive your money in three weeks or less. Choosing direct deposit may also accelerate the refund procedure.
Reduced likelihood of errors: According to the IRS, there’s approximately a 1% error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper yields.
Easy payment procedure: If you owe the IRS money, it’s simpler to pay 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. You also have the choice to pay your balance by using the IRS Direct 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 interest and penalties.
Digital storage of taxation information: Submitting returns electronically means there’s an electronic copy of your tax documents. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing this is easy.
The types do the math for you and provide basic advice. You can simply do your federal return with these forms.
Employing online tax prep software is far and away the favored approach of most taxpayers. In fact, the IRS says it expected more than four in five 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 this is not an issue that should deter you by e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, marketing and revenue at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has put safety measures in place to keep your information secure. “Trainers normally use IRS particular APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It is very important to use a trustworthy service that will help you file your taxes. Chow advises not to e-file on a computer or utilize an online connection that isn’t confidential.
For many taxpayers, it is sensible to e-file a yield since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just be certain that you use tax preparation software from a dependable source, so you can ensure the information which you provide to transmit to the IRS will be kept protected.