Is e-filing really a much better way to file 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.
The majority of 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 conserve the IRS cash because its workers don’t need to spend time manually processing your return. In return, you could get any refund you are owed faster, especially if you have it directly deposited into your bank accounts.
However, what about safety? And can digital filing actually provide you access to all the forms you might need in case you’ve got a intricate tax situation? Are there ever situations when you can’t e-file? Let us look at the advantages of e-filing, and if it may be the best filing option for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms are obtained: The IRS will confirm a tax filing has been received within one day of digital submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may take six to eight months to receive a tax refund. With e-filing, you are going to receive your money in 3 weeks or less. Choosing direct deposit may also speed up the refund process.
Reduced likelihood of mistakes: In accordance with the IRS, there’s approximately a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper returns.
Easy payment process: If you owe the IRS money, it’s simpler to pay at your advantage if you e-file. You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. Additionally you have the option to pay your balance by using the IRS Direct pay service from your 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 following the filing due date (typically April 15) can result in penalties and interest.
Digital storage of tax data: Submitting returns electronically implies there’s a digital copy of your tax documents. So if something happens to your paperwork, you’ll have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the process of doing so is simple.
How to e-file a tax return?
You have four choices for filing an electronically filed tax return to the IRS.
The types do the math for you and offer basic guidance. You can simply do your federal return with all these kinds.
Using online tax prep software is far and away the favored approach of the majority of taxpayers. In fact, the IRS says it anticipated more than four in five tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is suitable, you could worry about security — especially with all these data breaches. But experts agree this isn’t an issue that should dissuade you from e-filing.
“In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has put safety measures in place to keep your information secure. “Trainers normally use IRS particular APIs that need token sessions,” Chow says. “All this is routed over TLS encrypted connections.”
It’s important to employ a trusted service to help you record your taxes. Chow advises to not e-file on a computer or utilize an online connection that isn’t confidential.
For most taxpayers, it is sensible to e-file a yield because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices. Just make certain that you use tax planning software from a dependable source, so you can make certain the information which you provide to transmit to the IRS is going to be kept protected.