Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree about everything, but they are largely on precisely the exact same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed. E-filing is a favorite as it is a win-win for taxpayers and the IRS.
In return, you can find any refund you are owed faster, especially in the event that you have it directly deposited to your bank accounts.
But what about safety? And can digital filing actually give you access to all of the forms that you may need if you’ve got a complex tax situation? Are there situations when you can not e-file? Let us look at the benefits of e-filing, and whether it might be the best filing choice for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will affirm a tax filing was received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund. With e-filing, you are going to receive your money in 3 weeks or less. Choosing direct deposit may also speed up the refund process.
Reduced chance of mistakes: In accordance with the IRS, there’s approximately a 1% 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.
Easy payment process: If you owe the IRS money, it is easier to pay at your advantage if you e-file. You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline. Additionally you have the choice to pay your balance by using the IRS Direct pay service from your checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there’s an electronic backup of your tax records. So if something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those advantages — and the process of doing this is easy.
You have four choices for filing an electronically filed tax return to the IRS.
- Use IRS Free File: If your adjusted gross income is $72,000 or less you may have the ability to use the IRS Free File program.
- Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your taxes without any help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide standard advice. You can only do your federal return with all these forms.
- Utilize an internet tax preparation service or tax software: Tax prep software and online filing services are alternatives. These options are an easy way to finish and e-file your own forms. Some applications providers charge for their programs, Some are free. The software asks you simple questions about your own life and finances to guide you through the completion of your types.
- Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields. But eligibility for free aid is normally restricted based on income, and some providers appeal to particular demographic groups. By way of example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.
- Hire a paid preparer: Paid tax preparers, including CPAs, can e-file yields for you if they’re licensed IRS e-file providers. The IRS maintains a record of authorized providers, but you should be aware this option is likely to be the most costly one.
Using 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 program.
Is e-filing really secure?
While e-filing is suitable, you may be worried about security — particularly with all these data breaches. But experts agree that this is not a problem that should dissuade you by e-filing.
“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 information security at SCIS Security, explains that 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 links “
It’s very important to use a trustworthy service that will help you file your taxes. Chow advises to not e-file on a computer or utilize an internet connection which is not private.
For many taxpayers, it is sensible to e-file a yield since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options. Just make sure that you use tax planning software from a trusted source, so that you can ensure the information you supply to transmit to the IRS will be kept secure.