Is e-filing a better way to record your taxes?
Americans and the IRS might not agree on everything, but they are mostly on precisely the exact 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 as it is a win-win for taxpayers and the IRS.
And in return, you could find any refund you are owed faster, particularly in the event that you have it directly deposited to your bank account.
But what about safety? And can electronic filing actually give you access to all of the forms that you might need in case you have a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it may be the best filing choice for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will confirm 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 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 may also speed up the refund process.
Reduced chance of mistakes: In accordance with the IRS, there is approximately 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 yields compared with paper returns.
Easy payment process: If you owe the IRS money, it is simpler to pay at your convenience if you e-file. It’s possible to submit returns early and pay afterwards if needed, as long as you pay by the April 15 filing deadline. You also have the option to pay your balance by using the IRS Direct pay service from your checking account 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 information: Submitting returns electronically means there’s an electronic copy of your tax records. So if something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the practice of doing this is simple.
You have four choices for filing an electronically filed tax return to the IRS.
The forms do the math for you and offer basic guidance. You can simply do your federal return with all these forms.
Using online tax prep software is far and away the preferred approach of most taxpayers. Actually, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you could worry about security — especially with all these 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, marketing and revenue at LegalShield. “In actuality, 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 email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has put security measures in place to keep your information safe. “Trainers normally use IRS particular APIs that need token sessions,” Chow says. “All this can be routed over TLS encrypted connections”
It’s very important to use a trustworthy service to assist you record your taxes. Chow advises to not e-file on a public computer or utilize an online connection which isn’t confidential.
For many taxpayers, it makes sense 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 easy payment options. Just make certain to use tax planning software from a dependable source, so you may ensure the information which you provide to transmit to the IRS will be kept secure.