Is e-filing a better way to file your taxes?
Americans and the IRS may not agree about everything, but they’re 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. E-filing is popular because it’s a win-win for taxpayers and the IRS.
In return, you could get any refund you are owed faster, particularly if you have it directly deposited to your bank accounts.
However, what about security? And can electronic filing really provide you access to all the forms you may need in case you’ve got 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 may be the very best filing choice for your needs.
If you’re thinking about e-filing, some of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm a tax filing was 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 months to be given a tax refund. With e-filing, you are going to receive your money in 3 weeks or not. Choosing direct deposit may also speed up the refund process.
Reduced chance of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info 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 if you e-file. It’s possible to submit returns early and pay afterwards if necessary, as long as you pay by the April 15 filing deadline. And you’re able to 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. Additionally you have the option to pay your balance by using the IRS Immediate pay service from your checking or savings accounts, filing 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 implies there is an electronic backup of your tax records. If something happens to your paperwork, you will have a digital backup.
The good news: Most taxpayers do opt to e-file and find those benefits — and the practice of doing this is easy.
You have four choices for filing an electronically filed tax return to the IRS.
Employing online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it expected over four tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you may be worried about security — particularly with so many data breaches. But experts agree this isn’t a problem which should dissuade you by e-filing.
“In fact, it can be more secure than paper filing since you’re sending your private information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has set security measures in place to keep your information secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted connections.”
It’s important to use a trusted service that will help you record your taxes. Chow advises not to e-file on a public computer or use an online connection that isn’t private.
For most taxpayers, it makes sense to e-file a yield since it is 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 that you use tax planning software from a dependable source, so that you can ensure the information you supply to transmit to the IRS is going to be kept protected.