Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they’re largely on precisely the 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 popular because it is a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you conserve the IRS money because its workers don’t have to spend time manually processing your return. In return, you could get any refund you’re owed faster, especially if you have it directly deposited to your bank accounts.
But what about security? And can digital filing really give you access to all the forms that you may need if you’ve got a complex tax situation? Are there situations when you can’t e-file? Let’s look at the benefits of e-filing, and if it might be the very best filing choice for your needs.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will affirm 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 safely.
Timely refunds: When you submit a paper filing, it can take six to eight weeks to receive a tax refund. With e-filing, you are going to get your money in three weeks or less. Choosing direct deposit may also speed up the refund procedure.
Reduced likelihood of mistakes: In accordance with the IRS, there’s 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 issues discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it’s simpler to cover at your convenience when you e-file. It’s possible to submit returns early and pay later if needed, as long as you pay by the April 15 filing deadline. Additionally you have the option to pay your balance by making use of the IRS Immediate pay service from your checking or savings accounts, 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 lead to penalties and interest.
Digital storage of taxation information: Submitting returns electronically means there’s an electronic backup of your tax records. If something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the practice of doing so is simple.
How to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the favored 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 stable?
While e-filing is suitable, you could worry about safety — especially with all these data breaches. But experts agree that this isn’t a problem which should deter you by e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, marketing and sales at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your data in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set security measures in place to keep your information secure. “Vendors typically utilize IRS specific APIs that need ab 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 use an internet connection that is not private.
For most taxpayers, it is sensible to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be sure to use tax preparation software from a dependable source, so that you may ensure the information which you provide to transmit to the IRS is going to be kept secure.