Is e-filing a much better way to record your taxes?
Americans and the IRS might not agree about everything, but they’re largely on the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
In return, you could find any refund you are owed quicker, especially if you have it directly deposited into your bank accounts.
However, what about security? And can digital filing actually give you access to all the forms you may need if you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let us 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 are obtained: The IRS will confirm a tax filing was received within 24 hours of digital submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived .
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 three weeks or not. Choosing direct deposit may also accelerate the refund procedure.
Reduced chance of mistakes: In accordance with the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% speed of errors on paper filings. The IRS also provides more information on issues discovered on e-filed returns compared with paper yields.
Easy payment process: If you owe the IRS money, it is simpler to cover at your advantage when you e-file. It’s possible to submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline. You also have the choice to pay your balance by making use of the IRS Immediate pay service from the checking account or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of taxation information: Submitting returns electronically implies there is a digital backup of your tax documents. If something happens to your paperwork, then you’ll have an electronic backup.
The good news: Most taxpayers do opt to e-file and get those advantages — and the practice of doing this is simple.
The way to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
Employing online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it expected more than four tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you could worry about security — especially with all these data breaches. But experts agree this is not a problem which should dissuade you from e-filing.
“In actuality, it can be more secure than paper filing as you’re sending your personal information through an encrypted network as opposed to exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set safety measures in place to keep your information secure. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted connections”
It’s very important to use a trusted service that will assist you record your taxes. Chow advises to not e-file on a computer or utilize an online connection that is not confidential.
For most 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 effortless payment choices. Just make sure that you use tax planning software from a dependable source, so that you can ensure the information which you provide to transmit to the IRS will be kept secure.