Is e-filing really a better way to record your taxes?
Americans and the IRS might not agree on everything, but they are largely on precisely the exact 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 popular because it is a win-win for taxpayers and the IRS.
And 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 digital filing really provide you access to all the forms that you might need in case you’ve got a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and if it may be the best filing option for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will confirm a tax filing was 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 submit a paper filing, it can take six to eight months to receive a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced likelihood of mistakes: According to the IRS, there’s approximately a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed returns compared with paper returns.
Easy payment process: If you owe the IRS money, it’s easier to cover at your convenience if you e-file. It’s possible to submit returns early and pay later if necessary, provided that you pay from 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 accounts, filing a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of tax information: Submitting returns electronically means there’s a digital backup of your tax records. If something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing so is easy.
The way to e-file a tax return?
Employing online tax preparation 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 stable?
While e-filing is convenient, you may worry about security — especially with so many data breaches. But experts agree this isn’t an issue which should dissuade you by e-filing.
“In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has put safety measures in place to keep your data safe. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted connections.”
It is very important to use a trusted service to assist you file your taxes. Chow advises not to e-file on a computer or utilize an online connection that isn’t private.
For many taxpayers, it is sensible to e-file a return because it’s 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 that you use tax preparation software from a dependable source, so you may ensure the information you provide to transmit to the IRS will be kept secure.