Is e-filing really a much better way to record your taxes?
Americans and the IRS might not agree about everything, but they are largely on precisely the same page in regards 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 because it is a win-win for taxpayers and the IRS.
And in return, you can find any refund you’re owed quicker, especially in the event that you have it directly deposited into your bank account.
But what about security? And can electronic filing actually provide you access to all of the forms you might need if you have a complex tax situation? Are there ever situations when you can’t e-file? Let us look at the benefits of e-filing, and if it might be the best filing choice for your needs.
If you are Considering e-filing, a Few of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will confirm a tax filing has been received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
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 three weeks or not. Choosing direct deposit may also speed up the refund process.
Reduced likelihood of mistakes: According to the IRS, there’s approximately a 1% error rate on e-filed yields, 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 is simpler to cover at your advantage if you e-file. You can submit returns early and pay afterwards if necessary, as long as you pay by the April 15 filing deadline. You also have the option to pay your balance by making use of the IRS Direct pay service from the checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) will result in penalties and interest.
Digital storage of taxation information: Submitting returns electronically implies there is a digital copy of your tax records. So 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 practice of doing so is simple.
The way to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
The types do the math for you and offer standard guidance. You can simply do your federal return with all these kinds.
Employing online tax preparation software is far and away the preferred 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 convenient, you could worry about safety — especially with so many data breaches. But experts agree that this isn’t an issue which should dissuade you from e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted network as opposed to exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set security measures in place to keep your information secure. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It’s very important to use a trustworthy service to assist you record your taxes. Chow advises not to e-file on a public computer or use an online connection which isn’t private.
For many taxpayers, it makes sense to e-file a return since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options. Just make certain to use tax planning software from a dependable source, so that you can ensure the information you supply to transmit to the IRS will be kept protected.