Is e-filing a much better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
And in return, you can get any refund you are owed faster, especially if you have it directly deposited to your bank account.
But what about security? And can digital filing actually give 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 us look at the advantages of e-filing, and whether it might be the best filing choice for your requirements.
If you’re thinking about e-filing, a Few of the advantages include:
- Quick affirmation your forms have been received: The IRS will affirm a tax filing has been 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 publish a paper filing, it may take six to eight weeks to be given a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit can also accelerate the refund process.
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 returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it’s simpler to pay at your advantage when you e-file. You can submit returns early and pay afterwards if necessary, provided that you pay by the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Immediate pay service from your checking or savings account, filing 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 means there’s a digital copy of your tax records. So if something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the process of doing so is easy.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may have the ability to use the IRS Free File program.
- Free File Fillable Types — 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 forms do the math for you and provide standard advice. You can simply do your federal return with these forms.
- Use an online tax preparation tax or service applications: Tax prep software and online filing services are alternatives. These choices are an easy way to finish and e-file your own forms. Some software suppliers charge for their apps, Some are free. The program asks you simple questions about your life and finances to guide you through the completion of your forms.
- Get free, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns. However, eligibility for free help is normally restricted based on earnings, and some services cater to particular demographic groups. By way of instance, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are authorized IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this alternative is likely to be the most costly one.
Using online tax prep software is far and away the favored approach of most taxpayers. Actually, the IRS says it expected more than four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you could worry about safety — especially with all these data breaches. But experts agree that this is not a problem that should dissuade you by e-filing.
“In actuality, it may be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set security measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is important to use a trustworthy service to help you file your taxes. Chow advises not to e-file on a computer or use an online connection that is not confidential.
For most taxpayers, it makes sense to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options. Just be certain to use tax preparation software from a trusted source, so that you may ensure the information you supply to transmit to the IRS will be kept secure.