Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on precisely the same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed.
If you e-file your federal income tax return, you conserve the IRS cash because its workers do not have to spend time manually processing your return. In return, you could get any refund you’re owed quicker, especially if you have it directly deposited into your bank account.
However, what about security? And can digital filing really give you access to all of the forms that you might need if you’ve got a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it might be the best filing option for your requirements.
If you’re Considering e-filing, a Few of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within one day of digital submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived .
Timely refunds: When you publish a paper filing, it may take six to eight months to receive a tax refund. With e-filing, you are going to receive your money in three weeks or less. Choosing direct deposit may also accelerate the refund process.
Reduced chance of mistakes: In accordance with the IRS, there is 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 problems discovered on e-filed returns compared with paper yields.
Simple payment procedure: If you owe the IRS money, it is easier to cover at your convenience when you e-file. It’s possible to submit returns early and pay later if needed, provided that you pay by 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 Immediate pay service from the checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there is a digital backup of your tax documents. So if something happens to your paperwork, then you’ll have an electronic backup.
The good news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing this is easy.
The way to e-file a tax return?
Employing online tax preparation software is far and away the preferred 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 software.
Is e-filing really secure?
While e-filing is convenient, you may worry about security — particularly with so many data breaches. But experts agree that this isn’t a problem which should dissuade 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, advertising and revenue at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your information in the mail.”
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 need token sessions,” Chow says. “All this is routed over TLS encrypted links “
It’s very important to use a trustworthy service that will assist you record your taxes. Chow advises to not e-file on a public computer or utilize an online connection that isn’t confidential.
For most taxpayers, it makes sense to e-file a return because 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 that you use tax preparation software from a trusted source, so that you can make certain the information you supply to transmit to the IRS is going to be kept protected.