Is e-filing a much better way to record your taxes?
Americans and the IRS might not agree on everything, but they’re mostly on the exact same page when it comes 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 as it is a win-win for taxpayers and the IRS.
In return, you could get any refund you’re owed faster, particularly if you have it directly deposited to your bank accounts.
But what about safety? And can digital filing really provide you access to all of the forms 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 benefits of e-filing, and whether it might be the best filing choice for your needs.
If you are Considering e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely.
Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given a tax refund. With e-filing, you are going to get your money in three weeks or not. Choosing direct deposit may also speed up the refund process.
Reduced likelihood of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more information on issues discovered on e-filed returns compared with paper yields.
Easy payment procedure: If you owe the IRS money, it is easier to cover at your convenience when you e-file. You can submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline. You also have the choice to pay your balance by making use of the IRS Direct pay service from your checking or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can result in penalties and interest.
Digital storage of tax information: Submitting returns electronically implies there’s an electronic backup of your tax documents. So if something happens to your paperwork, then you’ll have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the process of doing so is simple.
How to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
The forms do the math for you and offer standard guidance. You can only do your federal return with these kinds.
Employing online tax preparation software is far and away the favored approach of most taxpayers. In fact, the IRS says it expected over four tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you may be worried about safety — particularly with so many data breaches. But experts agree that this is not an issue which should dissuade you from e-filing.
“E-filing a tax return has proven 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 can be more secure than paper filing as you’re sending your personal information through an encrypted system rather than 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 data secure. “Trainers normally use IRS particular APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is very important to use a trustworthy service to help you record your taxes. Chow advises to not e-file on a public computer or use an internet 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 be certain that you use tax planning software from a dependable source, so you may make certain the information which you supply to transmit to the IRS will be kept protected.