Is e-filing a better way to file your taxes?
Americans and the IRS may not agree about everything, but they are largely on precisely the same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is popular as it is a win-win for taxpayers and the IRS.
In return, you can get any refund you’re owed quicker, particularly if you have it directly deposited to your bank account.
However, what about safety? And can electronic filing actually give you access to all the forms that you might need in case you’ve got a intricate tax situation? Are there ever situations when you can not e-file? Let us look at the benefits of e-filing, and if it might be the best filing option for your needs.
If you’re thinking about e-filing, a Few of the advantages include:
- Quick confirmation your forms are received: The IRS will confirm a tax filing was 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 submit a paper filing, it may take six to eight months to receive a tax refund. With e-filing, you’ll receive your money in three weeks or less. Choosing direct deposit may also speed up the refund process.
Reduced likelihood of errors: According to the IRS, there’s 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 information on issues discovered on e-filed returns compared with paper yields.
Easy payment procedure: 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. And you can schedule electronic money transfers to easily send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by making use of the IRS Direct pay service from the checking account or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) will result in interest and penalties.
Digital storage of tax data: Submitting returns electronically implies there’s a digital copy of your tax documents. If something happens to your paperwork, then you will have an electronic backup.
The good news: Most taxpayers do decide to e-file and find those benefits — and the practice of doing this is simple.
How to e-file a tax return?
Employing online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it expected more than four tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you could be worried about security — especially with all these data breaches. But experts agree that this is not an issue that should deter you from e-filing.
“In fact, it can be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has set safety measures in place to keep your information safe. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It is very important to use a trusted service to help you file your taxes. Chow advises not to e-file on a computer or utilize an online connection which is not private.
For many taxpayers, it is sensible to e-file a return because 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 make certain that you use tax planning software from a trusted source, so that you may make certain the information you provide to transmit to the IRS will be kept secure.