Is e-filing really a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed.
And in return, you can get any refund you are owed faster, particularly in the event that you have it directly deposited into your bank account.
However, what about safety? And can electronic filing really provide 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 not e-file? Let’s look at the benefits of e-filing, and if it might be the very best filing option for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms are obtained: The IRS will affirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived .
Timely refunds: When you publish 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 accelerate the refund process.
Reduced chance of errors: According to the IRS, there is approximately a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper returns.
Simple payment process: If you owe the IRS money, it is simpler to pay at your advantage when you e-file. You can submit returns early and pay afterwards 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 Immediate pay service from your checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can result in interest and penalties.
Digital storage of tax information: Submitting returns electronically implies there’s an electronic copy of your tax documents. If something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do decide 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 choices for filing an electronically filed tax return to the IRS.
Using online tax prep software is far and away the preferred approach of the majority of taxpayers. In fact, the IRS says it expected over four tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could worry about safety — especially with all these data breaches. But experts agree this isn’t an issue which should dissuade you from e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product direction, marketing and revenue at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to 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 secure. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted links .”
It’s very important to use a trusted service to help you record your taxes. Chow advises to not e-file on a computer or use an online connection which is not confidential.
For most taxpayers, it is sensible to e-file a return because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options. Just make sure to use tax planning software from a trusted source, so that you may ensure the information which you supply to transmit to the IRS is going to be kept secure.