Is e-filing a better way to record your taxes?
Americans and the IRS may not agree on everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed.
And in return, you can find any refund you are owed quicker, especially in the event that you have it directly deposited into your bank account.
However, what about safety? And can digital filing really give you access to all of 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 whether it may be the best filing option for your needs.
If you’re Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will affirm a tax filing was received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you are going to get your money in three weeks or less. Choosing direct deposit can also speed up the refund procedure.
Reduced likelihood of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed yields, 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 yields.
Simple payment process: If you owe the IRS money, it is simpler to pay at your convenience when you e-file. It’s possible to submit returns early and pay afterwards if necessary, provided that you pay by the April 15 filing deadline. You also have the option to pay your balance by using the IRS Immediate pay service from the checking account or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax information: Submitting returns electronically implies there’s a digital backup of your tax documents. If something happens to your paperwork, you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those benefits — and the process of doing so is simple.
- Use IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program.
- Free File Fillable Forms — If your income is more than $72,000 and you’re comfortable doing your taxes without help, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer standard guidance. You can simply do your federal return with these kinds.
- Use an online tax preparation tax or service applications: Tax preparation software and online filing services are options. These choices are an easy way to finish and e-file your forms. Some software providers charge for their apps, Some are liberated. The software asks you simple questions about your life and finances to guide you through the completion of your types.
- Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns. However, eligibility for free aid is normally restricted based on income, and a few providers cater to particular demographic groups.
- Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a database of authorized providers, but you should be aware this option is very likely to be the most costly one.
Using online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it anticipated over four tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you may worry about safety — especially with all these data breaches. But experts agree this isn’t an issue which should deter you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, advertising and sales at LegalShield. “In actuality, it can be more secure than paper filing as you’re sending your private information through an encrypted network rather than exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set security measures in place to keep your information safe. “Vendors typically utilize IRS specific APIs that require token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is important to use a trustworthy service that will assist you record your taxes. Chow advises not to e-file on a public computer or utilize an internet connection that isn’t confidential.
For many taxpayers, it makes sense to e-file a return since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options. Just be sure that you use tax preparation software from a trusted source, so you may make certain the information you supply to transmit to the IRS is going to be kept protected.