Is e-filing really a much better way to file your taxes?
Americans and the IRS may not agree on everything, but they are mostly on the 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 find any refund you are owed faster, especially if you have it directly deposited to your bank account.
But what about security? And can digital filing actually give you access to all the forms you might need in case you’ve got a complex tax situation? Are there ever situations when you can’t 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, a Few of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will confirm a tax filing has been received within one day of electronic 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 can take six to eight weeks to be given a tax refund. With e-filing, you’ll receive your money in 3 weeks or less. Choosing direct deposit can also accelerate the refund procedure.
Reduced likelihood of mistakes: According to the IRS, there’s around a 1% error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.
Simple payment procedure: If you owe the IRS money, it is easier to pay at your convenience when you e-file. You can submit returns early and pay later if necessary, provided that you pay from the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Direct pay service from the checking or savings account, 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 means there is a digital copy of your tax records. If something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing so is simple.
Using online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it expected more than four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you may be worried about security — particularly with all these data breaches. But experts agree that this isn’t an issue that should deter you by e-filing.
“In actuality, it may be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your data in the mail.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set security measures in place to keep your data secure. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All of this is routed over TLS encrypted links “
It is important to use a trustworthy service to assist you record your taxes. Chow advises not to e-file on a public computer or use an internet connection that is not private.
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 easy payment options. Just make certain to use tax planning software from a trusted source, so you may ensure the information you supply to transmit to the IRS will be kept protected.