Is e-filing a better way to file your taxes?
Americans and the IRS may not agree on everything, but they are largely 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.
When you e-file your federal income tax return, you conserve the IRS cash because its workers don’t have to spend time manually processing your return. 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 really provide you access to all the forms you may need if you’ve got a intricate tax situation? Are there situations when you can’t e-file? Let’s look at the advantages of e-filing, and if it may be the very best filing option for your requirements.
If you are Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms are received: The IRS will confirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
Timely refunds: When you submit a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you’ll get your money in three weeks or not. Choosing direct deposit can also accelerate the refund process.
Reduced likelihood of errors: According to the IRS, there is approximately 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 yields.
Easy payment procedure: If you owe the IRS money, it is simpler to pay at your convenience when you e-file. You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline. And you can schedule electronic funds transfers to 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 choice to pay your balance by using the IRS Direct pay service from the checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax information: Submitting returns electronically implies there is an electronic copy of your tax records. If something happens to your paperwork, you’ll have an electronic backup.
The good news: Most taxpayers do opt to e-file and find those benefits — and the practice of doing so is simple.
How to e-file a tax return?
You have four options for submitting an electronically filed tax return to the IRS.
The types do the math for you and offer standard guidance. You can only do your federal return with these forms.
Using online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it anticipated 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 safety — especially with so many data breaches. But experts agree this isn’t 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,” states Scott Grissom, vice president of product direction, marketing and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your private information through an encrypted network rather than exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS specific APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links “
It’s very important to employ a trusted service that will assist you record your taxes. Chow advises to not e-file on a computer or utilize an online connection which isn’t confidential.
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 easy payment choices. Just be sure to use tax preparation software from a trusted source, so that you may ensure the information which you provide to transmit to the IRS will be kept protected.