Is e-filing really a better way to file your taxes?
Americans and the IRS may not agree about everything, but they are largely on the exact 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 as it is a win-win for taxpayers and the IRS.
And in return, you can get any refund you are owed faster, particularly if you have it directly deposited into your bank accounts.
However, what about security? And can digital filing really give you access to all of the forms that you might need in case you have 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 best filing option for your needs.
If you’re thinking about e-filing, some of the advantages include:
- Quick affirmation your forms have been received: The IRS will affirm a tax filing was received within one day 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 may 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 less. Choosing direct deposit can also speed up the refund procedure.
Reduced chance of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Simple payment procedure: If you owe the IRS money, it is simpler to cover at your convenience when you e-file. It’s possible to submit returns early and pay later if necessary, provided that you pay from the April 15 filing deadline. Additionally you have the choice to pay your balance by making use of the IRS Immediate pay service from the checking account or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) can result in penalties and interest.
Digital storage of tax data: Submitting returns electronically means there is an electronic copy of your tax documents. So if something happens to your paperwork, then you’ll have a digital backup.
The good news: Most taxpayers do decide to e-file and get those advantages — and the process of doing this is simple.
How to e-file a tax return?
The forms do the math for you and offer basic guidance. You can only do your federal return with all these forms.
Using online tax preparation 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 secure?
While e-filing is convenient, you may worry about safety — especially with all these data breaches. But experts agree that this is not an issue that should dissuade 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 since you’re sending your personal 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 safety measures in place to keep your information secure. “Vendors typically utilize IRS specific APIs that require ab sessions,” Chow says. “All this can be routed over TLS encrypted connections.”
It is important to employ a trustworthy service to assist you file your taxes. Chow advises not to e-file on a public computer or use an online connection that is not confidential.
For most taxpayers, it makes sense to e-file a yield since it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options. Just make certain that you use tax planning software from a dependable source, so you may make certain the information you provide to transmit to the IRS is going to be kept protected.