Is e-filing a much better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on the exact same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
When you e-file your federal income tax return, you save the IRS cash because its workers do not have to spend time manually processing your return. And in return, you could find any refund you’re owed quicker, particularly if you have it directly deposited into your bank account.
However, what about security? And can electronic filing actually give you access to all of the forms that you may need in case you’ve got a complex tax situation? Are there situations when you can not e-file? Let’s look at the advantages of e-filing, and if it might be the best filing option for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are obtained: The IRS will affirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived .
Timely refunds: When you publish 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 not. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of mistakes: In accordance with the IRS, there’s around a 1 percent error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it’s easier to cover at your advantage if you e-file. It’s possible to submit returns early and pay later if necessary, as long as 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 the checking or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can lead to interest and penalties.
Digital storage of taxation information: Submitting returns electronically implies there is an electronic backup of your tax records. If something happens to your paperwork, you’ll have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the process of doing so is simple.
How to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
The types do the math for you and offer basic advice. You can only do your federal return with these kinds.
Using online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it expected more than four in five tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you could worry about security — particularly with all these data breaches. But experts agree this isn’t an issue that should deter you by e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In fact, 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 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. “Trainers normally use IRS specific APIs that require ab sessions,” Chow says. “All this can be routed over TLS encrypted links “
It is very important to employ a trustworthy service to help you record your taxes. Chow advises not to e-file on a public computer or use an internet connection that isn’t confidential.
For many taxpayers, it makes sense 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 be sure to use tax preparation software from a dependable source, so that you may make certain the information which you provide to transmit to the IRS will be kept protected.