Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree on everything, but they are mostly on the exact 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 can get any refund you are owed quicker, particularly in the event that you have it directly deposited to your bank account.
However, what about security? And can digital filing actually give you access to all the forms you may need if you have a complex tax situation? Are there situations when you can’t e-file? Let us look at the benefits of e-filing, and if it may be the best filing option for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick affirmation your forms have been received: The IRS will affirm a tax filing has been 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 speed up the refund process.
Reduced chance of mistakes: In accordance with the IRS, there’s around a 1% error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more info on problems discovered on e-filed returns compared with paper yields.
Easy payment process: If you owe the IRS money, it’s easier to pay at your advantage if you e-file. It’s possible to submit returns early and pay afterwards if necessary, as long as you pay by the April 15 filing deadline. And you’re able to schedule electronic money transfers to easily send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. You also have the choice to pay your balance by making use of the IRS Direct pay service from the checking or savings account, filing a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) can result in interest and penalties.
Digital storage of tax data: Submitting returns electronically implies there is a digital backup of your tax documents. If something happens to your paperwork, you’ll have an electronic backup.
The fantastic news: Most taxpayers do opt to e-file and find those advantages — and the process of doing this is easy.
You have four options for filing an electronically filed tax return to the IRS.
The forms do the math for you and provide standard guidance. You can simply do your federal return with all these forms.
Using online tax prep software is far and away the favored approach of the majority of taxpayers. In fact, the IRS says it expected over four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you may worry about security — particularly with all these data breaches. But experts agree that this is not an issue that should deter you by e-filing.
“In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted network rather than 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 need ab sessions,” Chow says. “All this is routed over TLS encrypted connections.”
It is important to use a trusted service to help you file your taxes. Chow advises not to e-file on a computer or utilize an online connection that isn’t confidential.
For many taxpayers, it makes sense to e-file a return since it’s 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 to use tax preparation software from a dependable source, so you may make certain the information which you supply to transmit to the IRS is going to be kept protected.