Is e-filing a much better way to record your taxes?
Americans and the IRS may not agree about everything, but they’re mostly 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.
And in return, you can find any refund you’re owed faster, particularly if you have it directly deposited into your bank account.
But what about security? And can electronic filing really give you access to all the forms you may need if you have a intricate tax situation? Are there situations when you can’t e-file? Let’s look at the benefits of e-filing, and whether it may be the best filing option for your requirements.
If you are Considering e-filing, some of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will affirm a tax filing was 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 months to receive a tax refund. With e-filing, you’ll get your money in three weeks or less. Choosing direct deposit can also speed up the refund process.
Reduced chance of mistakes: According to the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper returns.
Easy payment procedure: If you owe the IRS money, it’s simpler to cover at your convenience when you e-file. You can submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline. And you’re able to schedule electronic money transfers to send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from your checking account or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) can lead to penalties and interest.
Digital storage of taxation information: Submitting returns electronically means there is an electronic copy of your tax records. If something happens to your paperwork, then you will have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the process of doing this is simple.
You have four options for submitting an electronically filed tax return to the IRS.
The types do the math for you and offer standard advice. You can only do your federal return with all these kinds.
Using online tax preparation software is far and away the favored approach of most taxpayers. In fact, the IRS says it expected more than four tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you could be worried about safety — especially with all these data breaches. But experts agree this isn’t an issue that should dissuade you from e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, advertising and sales at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set safety measures in place to keep your data safe. “Trainers normally use IRS particular APIs that require ab sessions,” Chow says. “All this is routed over TLS encrypted links “
It’s very important to use a trusted service to assist you record your taxes. Chow advises to not e-file on a computer or use an internet connection that is not confidential.
For many taxpayers, it makes sense 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 choices. Just be sure to use tax planning software from a dependable source, so you may make certain the information which you supply to transmit to the IRS will be kept secure.