Is e-filing a better way to file your taxes?
Americans and the IRS might not agree on everything, but they are largely on the same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed.
If you e-file your federal income tax return, you conserve the IRS cash because its employees do not have to spend time manually processing your return. In return, you can get any refund you are owed quicker, especially in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can digital filing actually give you access to all the forms that you may need if you’ve got a complex tax situation? Are there ever situations when you can’t e-file? Let’s look at the advantages of e-filing, and whether it might be the best filing option for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms have been received: The IRS will affirm 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 .
Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund. With e-filing, you’ll receive your money in three weeks or not. Choosing direct deposit can also accelerate the refund process.
Reduced chance of errors: According to the IRS, there’s approximately a 1 percent error rate on e-filed returns, compared with a 20% speed 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 easier to pay at your convenience when you e-file. It’s possible to submit returns early and pay later if needed, 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, filing a credit card through a payment processor for a commission, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically implies there is a digital backup of your tax documents. So if something happens to your paperwork, then you’ll have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the practice of doing this is simple.
How to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you may have the ability to use the IRS Free File program. The types do the math for you and provide basic guidance. You can simply do your federal return with all these forms.
- Utilize an online tax preparation service or tax applications: Tax preparation software and online filing services are alternatives. These choices are an easy way to finish and e-file your own forms. Some software providers charge for their apps, Some are free. The software asks you simple questions about your life and financing to guide you through the completion of your forms.
- Get complimentary, 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 some services cater to specific demographic groups. By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. The IRS maintains a record of authorized providers, but you should be aware this alternative is very 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 anticipated more than four in five tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you could worry about safety — particularly with all these data breaches. But experts agree this isn’t a problem that should deter you from e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In fact, it can be more secure than paper filing since you’re sending your private information through an encrypted system as opposed to exposing your data in the email.”
Dennis Chow, vice president of information security at SCIS Security, clarifies that the IRS has set safety measures in place to keep your data safe. “Trainers normally use IRS particular APIs that need ab sessions,” Chow says. “All of this is routed over TLS encrypted connections”
It is very important to use a trustworthy service to assist you file your taxes. Chow advises to not e-file on a public computer or use an internet connection which isn’t private.
For most taxpayers, it is sensible to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options. Just make certain to use tax planning software from a trusted source, so you can make certain the information you provide to transmit to the IRS is going to be kept secure.