Is e-filing really a much better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re mostly on precisely the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed. E-filing is popular because it’s a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you save the IRS money because its workers do not have to spend time manually processing your return. And in return, you could get any refund you’re owed quicker, especially if you have it directly deposited to your bank account.
However, what about safety? And can electronic filing really give you access to all of the forms that you might need if you’ve got a complex tax situation? Are there situations when you can not e-file? Let us look at the advantages of e-filing, and whether it may be the best filing choice for your requirements.
If you are thinking about e-filing, a Few 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 digital 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 can take six to eight weeks to be given a tax refund. With e-filing, you’ll get your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of errors: In accordance with the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.
Easy payment process: If you owe the IRS money, it’s easier to pay at your convenience when you e-file. You can submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline. Additionally you have the option to pay your balance by using the IRS Immediate 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. Just be aware delaying payment following the filing due date (typically April 15) can result in penalties and interest.
Digital storage of tax data: Submitting returns electronically means there’s an electronic copy of your tax documents. So if something happens to your paperwork, then you’ll have an electronic backup.
The good news: Most taxpayers do opt to e-file and get those advantages — and the practice of doing so is easy.
The way to e-file a tax return?
You have four options for submitting an electronically filed tax return to the IRS.
The forms do the math for you and offer standard advice. You can simply do your federal return with these forms.
Employing online tax preparation software is far and away the preferred approach of most taxpayers. In fact, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you may be worried about security — particularly with so many data breaches. But experts agree that this isn’t a problem that should deter 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 leadership, marketing and sales at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains the IRS has put security measures in place to keep your information safe. “Trainers normally use IRS specific APIs that require token sessions,” Chow says. “All this is routed over TLS encrypted links “
It is important to use a trusted service that will assist you file your taxes. Chow advises to not e-file on a public computer or utilize an internet connection that is not private.
For many taxpayers, it is sensible to e-file a return because it’s 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 that you may make certain the information you provide to transmit to the IRS is going to be kept protected.