Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree about everything, but they’re largely on the exact same page when it comes 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.
And in return, you can find any refund you’re owed quicker, particularly if you have it directly deposited into your bank accounts.
But what about safety? And can electronic filing really provide you access to all the forms you may need if you have a complex tax situation? Are there situations when you can not e-file? Let’s look at the advantages of e-filing, and whether it may be the best filing option for your needs.
If you are Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been received: The IRS will confirm a tax filing was received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived .
Timely refunds: When you submit a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you are going to get your money in three weeks or not. Choosing direct deposit can also accelerate the refund procedure.
Reduced chance of errors: According to the IRS, there’s around a 1% error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.
Easy payment process: If you owe the IRS money, it is simpler to pay at your advantage if you e-file. You can submit returns early and pay later if needed, provided that 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, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by using the IRS Direct pay service from your checking account 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 information: Submitting returns electronically means there is a digital copy of your tax records. If something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the practice of doing this is simple.
The way 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 filed through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you could worry about safety — especially with all these data breaches. But experts agree this is not an issue which should dissuade you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your data in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has put safety measures in place to keep your information safe. “Trainers normally use IRS particular APIs that require token sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It is important to use a trusted service that will help you record your taxes. Chow advises not to e-file on a public computer or use an internet connection that isn’t confidential.
For most taxpayers, it makes sense to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices. Just make certain that you use tax preparation software from a dependable source, so that you may ensure the information which you supply to transmit to the IRS is going to be kept protected.