Is e-filing really a better way to file your taxes?
Americans and the IRS may not agree about everything, but they’re largely on the same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
When you e-file your federal income tax return, you conserve the IRS money because its employees do not have to spend time manually processing your return. And in return, you could find any refund you’re owed faster, particularly in the event that you have it directly deposited to your bank account.
But what about safety? And can electronic filing actually give you access to all of the forms that you might need in case you have a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and whether it may be the very best filing option for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will affirm a tax filing was 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 publish a paper filing, it may take six to eight months to receive a tax refund. With e-filing, you are going to get your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund procedure.
Reduced likelihood of errors: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% speed of errors on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.
Easy payment procedure: If you owe the IRS money, it is easier to cover at your convenience if you e-file. You can submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline. And you’re able to schedule electronic funds transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. You also have the option to pay your balance by using the IRS Immediate pay service from the 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 implies there’s an electronic backup of your tax records. If something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the process of doing this is simple.
Using online tax preparation software is far and away the preferred approach of the majority of 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 convenient, you may be worried about security — especially with so many data breaches. But experts agree this is not an issue that should deter you from e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has put safety measures in place to keep your information safe. “Trainers normally use IRS particular APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted connections.”
It’s important to employ a trusted service to assist you record your taxes. Chow advises to not e-file on a computer or use an online connection that is not private.
For most taxpayers, it is sensible to e-file a yield because it is 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 planning software from a dependable source, so you can make certain the information you supply to transmit to the IRS is going to be kept secure.