Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree about everything, but they’re largely on precisely the exact same page in regards to e-filing individual income tax returns.
Nearly all 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.
When you e-file your federal income tax return, you save the IRS cash because its employees don’t have to spend time manually processing your return. In return, you can get any refund you are owed quicker, especially if you have it directly deposited into your bank account.
But what about security? And can electronic filing actually give you access to all the forms that you might need in case you’ve got a intricate tax situation? Are there ever situations when you can’t e-file? Let’s look at the advantages of e-filing, and if it might be the best filing option for your needs.
If you’re thinking about e-filing, a Few 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 doesn’t send any acknowledgment 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 three weeks or less. Choosing direct deposit may also accelerate the refund process.
Reduced chance of mistakes: According to the IRS, there’s around a 1% error rate on e-filed yields, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed yields compared with paper yields.
Easy payment process: If you owe the IRS money, it’s simpler to pay at your convenience when you e-file. You can submit returns early and pay later if necessary, provided that you pay from the April 15 filing deadline. Additionally you have the choice 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 fee, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically means there is a digital copy of your tax documents. If something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing this is easy.
The way to e-file a tax return?
- 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 Forms — If your income is more than $72,000 and you’re comfortable doing your earnings without any help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide standard advice. You can only do your federal return with these kinds.
- Utilize an internet tax preparation service or tax software: Tax prep software and online filing services are alternatives. These choices are a simple way to finish and e-file your forms. Some software suppliers charge for their programs, Some are liberated. The program asks you simple questions about your life and financing to steer you through the completion of your forms.
- Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns. However, eligibility for free help is typically limited based on earnings, and a few providers cater to particular demographic groups.
- Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a record of authorized providers, but be aware this option is likely to be the most costly one.
Using online tax preparation software is far and away the preferred approach of the majority of taxpayers. In fact, the IRS says it expected more than four in five tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could be worried about security — especially with so many data breaches. But experts agree this isn’t a problem that should deter you from e-filing.
“In fact, it can be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your data in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has set security measures in place to keep your data safe. “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says. “All this can be routed over TLS encrypted links “
It is important to use a trusted service that will assist you file your taxes. Chow advises not to e-file on a computer or utilize an online connection which is not confidential.
For most taxpayers, it makes sense 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 to use tax preparation software from a trusted source, so you may ensure the information which you supply to transmit to the IRS is going to be kept protected.