Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on the same page in regards 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 as it is a win-win for taxpayers and the IRS.
In return, you could find any refund you are owed quicker, particularly in the event that you have it directly deposited to your bank account.
However, what about safety? And can electronic filing really give 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 advantages of e-filing, and whether it might be the very best filing choice for your requirements.
If you’re thinking about e-filing, some of the advantages include:
- Quick affirmation your forms are received: The IRS will affirm a tax filing was received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived .
Timely refunds: When you submit a paper filing, it may take six to eight months to be given a tax refund. With e-filing, you’ll get your money in three weeks or not. Choosing direct deposit can also accelerate the refund procedure.
Reduced chance of errors: In accordance with the IRS, there is approximately a 1% error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more information on problems discovered on e-filed yields compared with paper returns.
Easy payment process: If you owe the IRS money, it is simpler to cover at your advantage when you e-file. You can submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline. 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 commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) will result in penalties and interest.
Digital storage of tax data: Submitting returns electronically implies there’s an electronic backup of your tax records. So if something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and find those advantages — and the practice of doing this is simple.
The way to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you could be able to use the IRS Free File program. The forms do the math for you and offer basic advice. You can only do your federal return with these forms.
- Utilize an internet tax preparation tax or service software: Tax preparation software and online filing services are alternatives. These options are a simple way to complete and e-file your forms. Some applications suppliers charge for their programs, Some are free. The software asks you simple questions about your own life and financing to steer you through the completion of your types.
- Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields. But eligibility for free aid is typically limited based on earnings, and a few providers cater to specific demographic groups. For example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.
- Hire a paid preparer: Paid tax preparers, including CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a record of licensed providers, but be aware this option is likely to be the most costly one.
Using online tax prep 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 submitted through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you may be worried about safety — especially with all these data breaches. But experts agree that this is not an issue which should dissuade you from e-filing.
“In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted network as opposed to exposing your data in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has set security measures in place to keep your data safe. “Trainers normally use IRS specific APIs that require ab sessions,” Chow says. “All this can be routed over TLS encrypted connections.”
It’s important to employ a trustworthy service to assist you record your taxes. Chow advises to not e-file on a computer or utilize an internet connection which is not private.
For most taxpayers, it makes sense to e-file a return since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment options. Just be certain that you use tax preparation software from a dependable source, so that you may ensure the information which you provide to transmit to the IRS is going to be kept secure.