Is e-filing a much better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on precisely the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is a favorite as it is a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you conserve the IRS cash because its employees do not need to spend time manually processing your return. In return, you can get any refund you’re owed quicker, especially if you have it directly deposited to your bank account.
But what about safety? And can electronic filing actually give you access to all the forms that you may need in case you have a intricate tax situation? Are there ever situations when you can not e-file? Let us look at the benefits of e-filing, and whether it might be the very best filing choice 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 has been received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment 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 get your money in 3 weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced likelihood of errors: According to the IRS, there is 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 issues discovered on e-filed yields compared with paper returns.
Easy payment procedure: If you owe the IRS money, it is easier to pay at your advantage if you e-file. You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline. And you can schedule electronic funds 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 choice to pay your balance by using the IRS Direct pay service from the checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.
Digital storage of tax data: Submitting returns electronically means there’s an electronic copy of your tax documents. So if something happens to your paperwork, you’ll have an electronic backup.
The good news: Most taxpayers do opt to e-file and find those advantages — and the process of doing so is easy.
The way to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program. The types do the math for you and provide standard guidance. You can simply do your federal return with all these forms.
- Utilize an online tax preparation tax or service applications: Tax prep software and online filing services are alternatives. These choices are a simple way to complete and e-file your forms. Some software suppliers charge for their programs, Some are free. The software asks you simple questions about your own life and finances to guide you through the completion of your forms.
- Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields. However, eligibility for free aid is normally restricted based on earnings, and a few providers appeal to specific demographic groups. For example, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older.
- Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they are licensed IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this alternative is very likely to be the most costly one.
Employing online tax prep software is far and away the favored approach of most taxpayers. Actually, the IRS says it expected more than four tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you may be worried about security — particularly with all these data breaches. But experts agree that this isn’t an issue that should dissuade you from e-filing.
“In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your information in the email.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has put security measures in place to keep your data secure. “Trainers normally use IRS specific APIs that require ab sessions,” Chow says. “All this is routed over TLS encrypted links .”
It is important to use a trustworthy service to help you record your taxes. Chow advises not to e-file on a public computer or utilize an internet connection that isn’t private.
For many 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 effortless payment choices. Just make sure that you use tax preparation software from a dependable source, so that you can make certain the information which you provide to transmit to the IRS will be kept protected.