Is e-filing really a much 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 filed to the IRS are e-filed. E-filing is popular because it is a win-win for taxpayers and the IRS.
And in return, you can get any refund you are owed faster, especially if you have it directly deposited into your bank account.
But what about safety? And can electronic filing actually give you access to all of the forms you might need if you have a complex tax situation? Are there ever situations when you can’t e-file? Let’s look at the advantages of e-filing, and whether it may be the best filing option for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will confirm a tax filing was received within 24 hours of electronic 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 get your money in 3 weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced chance of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% rate of errors 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’s easier to cover at your convenience if you e-file. You can submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline. And you’re able to schedule electronic funds 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 option to pay your balance by making use of the IRS Immediate pay service from your checking account or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there is an electronic backup of your tax documents. If something happens to your paperwork, then you’ll 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 easy.
- Use IRS Free File: If your adjusted gross income is $72,000 or less you could have the ability to use the IRS Free File program.
- Free File Fillable Types — If your income is over $72,000 and you are comfortable doing your earnings without any assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide basic guidance. You can only do your federal return with all these kinds.
- Utilize an internet tax preparation service or tax applications: Tax prep software and online filing services are alternatives. These options are a simple way to complete and e-file your forms. Some applications suppliers charge for their programs, Some are free. The program asks you simple questions about your life and finances to steer you through the completion of your types.
- Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns. However, eligibility for free aid is normally restricted based on income, and some providers appeal to specific demographic groups. The IRS maintains a database of licensed providers, but you should be aware this option is likely to be the most costly one.
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 in five tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you may be worried about safety — particularly with all these data breaches. But experts agree that this is not an issue that should deter you by e-filing.
“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 email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has set safety measures in place to keep your data secure. “Trainers normally use IRS particular APIs that require token sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It is important to use a trustworthy service to help you record your taxes. Chow advises not to e-file on a public computer or use an internet connection which is not private.
For most taxpayers, it is sensible to e-file a return because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options. Just make sure that you use tax planning software from a trusted source, so that you may ensure the information you supply to transmit to the IRS is going to be kept secure.