Is e-filing a much better way to file your taxes?
Americans and the IRS may not agree about everything, but they are largely on the exact 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 could find any refund you are owed quicker, particularly in the event that you have it directly deposited into your bank account.
However, what about security? And can digital filing really give you access to all the forms that you may need if you have 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 may be the very best filing option for your needs.
If you’re thinking about e-filing, some of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will confirm a tax filing was received within 24 hours of digital 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 receive a tax refund. With e-filing, you’ll receive your money in 3 weeks or not. Choosing direct deposit may also accelerate the refund process.
Reduced likelihood of mistakes: In accordance with the IRS, there is 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 yields.
Easy payment process: If you owe the IRS money, it’s simpler to cover at your advantage if you e-file. It’s possible to submit returns early and pay later if necessary, provided that you pay from 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, as long as the IRS receives your payment by Tax Day. Additionally you have the option 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. Just be aware delaying payment following the filing due date (typically April 15) can result in penalties and interest.
Digital storage of taxation information: Submitting returns electronically means there’s an electronic copy of your tax documents. So 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 advantages — and the practice of doing this is easy.
How to e-file a tax return?
Employing online tax prep software is far and away the preferred approach of most taxpayers. In fact, the IRS says it anticipated more than four tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is suitable, you may be worried about safety — especially with so many data breaches. But experts agree that this is not an issue that should dissuade you from 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 direction, advertising and sales at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has put 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’s important to employ a trusted service to help you file your taxes. Chow advises not to e-file on a computer or utilize an internet connection that is not confidential.
For most 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 choices. Just be certain to use tax preparation software from a trusted source, so that you may make certain the information you provide to transmit to the IRS will be kept secure.