Is e-filing really a much better way to file your taxes?
Americans and the IRS might not agree on everything, but they’re largely on the exact 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.
If you e-file your federal income tax return, you save the IRS cash because its employees do not have to spend time manually processing your return. In return, you could find any refund you’re owed quicker, particularly if you have it directly deposited into your bank account.
But what about security? And can digital filing actually give you access to all the forms that you might need if you have a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and if it might be the very best filing option for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been received: The IRS will affirm a tax filing has been received within 24 hours of electronic 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 weeks to be given a tax refund. With e-filing, you are going to receive your money in three weeks or less. Choosing direct deposit may also speed up the refund procedure.
Reduced likelihood of errors: According to the IRS, there’s around a 1 percent error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper yields.
Simple payment process: If you owe the IRS money, it’s simpler to pay at your convenience when 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’re able to 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. Additionally you have the option to pay your balance by using the IRS Immediate pay service from your checking account or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of taxation data: Submitting returns electronically implies there is an electronic backup of your tax documents. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the process of doing so is simple.
Using online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it anticipated more than four tax returns to be submitted through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you could be worried about safety — especially with so many data breaches. But experts agree that this is not a problem which should deter you by e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and sales at LegalShield. “In fact, it may be more secure than paper filing as you’re sending your private information through an encrypted network rather than exposing your information in the email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has put safety measures in place to keep your information safe. “Vendors typically utilize IRS particular APIs that require ab sessions,” Chow says. “All this can be routed over TLS encrypted connections.”
It is very important to employ a trusted service that will help you record your taxes. Chow advises not to e-file on a computer or use an internet connection that isn’t confidential.
For many taxpayers, it is sensible to e-file a return 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 sure to use tax preparation software from a dependable source, so you may ensure the information you supply to transmit to the IRS will be kept secure.