Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree about everything, but they’re mostly on the 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 as it is a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS money because its employees don’t need to spend time manually processing your return. In return, you can find any refund you’re owed faster, particularly in the event that you have it directly deposited to your bank accounts.
But what about security? And can digital filing actually provide you access to all of the forms you may need if you’ve got a complex tax situation? Are there situations when you can’t e-file? Let’s look at the benefits of e-filing, and if it may be the best filing choice for your needs.
If you are thinking about e-filing, a Few of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived .
Timely refunds: When you submit 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 can also accelerate the refund process.
Reduced chance of errors: In accordance with the IRS, there’s around a 1 percent error rate on e-filed returns, compared with a 20% speed of errors on paper filings. The IRS also provides more information on problems discovered on e-filed yields compared with paper returns.
Simple payment process: If you owe the IRS money, it is easier to cover at your advantage if you e-file. You can submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline. Additionally you have the option to pay your balance by making use of 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) will result in interest and penalties.
Digital storage of tax information: Submitting returns electronically implies there is an electronic copy of your tax documents. If something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the process of doing this is easy.
You have four options for filing an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the favored approach of most taxpayers. Actually, the IRS says it expected more than four tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you could worry about safety — particularly with so many data breaches. But experts agree this is not a problem that should deter 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, advertising and revenue at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted system 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 information safe. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted links “
It’s very important to employ a trustworthy service that will help you record your taxes. Chow advises not to e-file on a computer or utilize an online connection which isn’t confidential.
For most taxpayers, it makes sense to e-file a yield since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be certain to use tax planning software from a trusted source, so you can ensure the information you supply to transmit to the IRS is going to be kept protected.