Is e-filing a much better way to file your taxes?
Americans and the IRS might not agree on 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 filed to the IRS are e-filed. E-filing is a favorite because it’s 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 do not have to spend time manually processing your return. In return, you could get any refund you’re owed faster, particularly if you have it directly deposited into your bank account.
However, what about safety? And can digital filing really provide 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 benefits of e-filing, and if it might be the best filing choice for your requirements.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within one day of electronic submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived safely.
Timely refunds: When you publish a paper filing, it can take six to eight weeks to receive a tax refund. With e-filing, you are going to receive your money in 3 weeks or less. Choosing direct deposit may also accelerate the refund procedure.
Reduced likelihood of errors: According to the IRS, there’s approximately a 1% error rate on e-filed returns, compared with a 20% speed of errors on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.
Simple payment procedure: If you owe the IRS money, it’s easier to pay at your convenience if you e-file. You can submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline. Additionally you have the choice to pay your balance by using the IRS Direct pay service from the checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there’s a digital backup of your tax documents. So if something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and find those benefits — and the process of doing so is simple.
You have four choices for submitting an electronically filed tax return to the IRS.
- Use IRS Free File: If your adjusted gross income is $72,000 or less you may be able to use the IRS Free File program.
- Free File Fillable Forms — If your income is over $72,000 and you’re comfortable doing your taxes without help, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer standard guidance. You can simply do your federal return with all these kinds.
- Utilize an online tax preparation tax or service applications: Tax prep software and online filing services are options. These choices are a simple way to complete and e-file your own forms. Some software suppliers charge for their programs, Some are free. The program asks you simple questions about your own life and finances to guide 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 yields. However, eligibility for free aid is typically limited based on income, and a few providers cater 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 database of authorized providers, but you should be aware this option is likely to be the most costly one.
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 filed through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could worry about safety — especially with so many data breaches. But experts agree that this isn’t an issue which should dissuade you from e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your information in the email.”
Dennis Chow, vice president of information 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 need token sessions,” Chow says. “All of this is routed over TLS encrypted connections.”
It is very important to use a trusted service to help you file your taxes. Chow advises not to e-file on a computer or utilize an online connection that isn’t confidential.
For most taxpayers, it is sensible to e-file a return since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just make certain that you use tax preparation software from a dependable source, so you can make certain the information you supply to transmit to the IRS is going to be kept secure.