Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they’re largely on the exact same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
In return, you can find any refund you’re owed quicker, particularly if you have it directly deposited into your bank accounts.
However, what about security? And can electronic filing actually provide you access to all the forms that you might need if you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let’s look at the benefits of e-filing, and if it may be the best filing option for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will affirm a tax filing has been received within 24 hours of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
Timely refunds: When you publish a paper filing, it may take six to eight months 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 process.
Reduced likelihood of errors: In accordance with the IRS, there’s around a 1 percent error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed returns compared with paper yields.
Simple payment procedure: If you owe the IRS money, it’s simpler to cover at your advantage when you e-file. You can submit returns early and pay later if necessary, 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, 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 the checking account or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) will result in penalties and interest.
Digital storage of taxation data: Submitting returns electronically means there is an electronic copy of your tax records. If something happens to your paperwork, you’ll have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and find those benefits — and the practice of doing this is simple.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you could be able to use the IRS Free File program. The forms do the math for you and provide standard advice. You can only do your federal return with all these forms.
- Utilize an internet tax preparation service or tax software: Tax preparation software and online filing services are alternatives. These options are a simple way to finish and e-file your forms. Some applications providers charge for their programs, Some are liberated. The program asks you simple questions about your own life and financing to steer you through the completion of your forms.
- Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields. But eligibility for free help is typically limited based on income, and some services appeal to specific demographic groups. By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. The IRS maintains a record of authorized providers, but be aware this option is very likely to be the most costly one.
Employing online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it anticipated more than four in five tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you could be worried about safety — especially with so many data breaches. But experts agree that this isn’t a problem that should dissuade you from e-filing.
“In fact, it may be more secure than paper filing as you’re sending your personal information through an encrypted network as opposed to exposing your data in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has put security measures in place to keep your data safe. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It’s very important to use a trustworthy service that will assist you file your taxes. Chow advises to not e-file on a computer or utilize an internet connection which is not confidential.
For most taxpayers, it is sensible to e-file a yield since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just be certain that you use tax planning software from a trusted source, so you can make certain the information which you supply to transmit to the IRS will be kept protected.