Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree on everything, but they are mostly on precisely the same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed. E-filing is popular because it is a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS money because its employees don’t have to spend time manually processing your return. And in return, you can find any refund you’re owed faster, especially in the event that you have it directly deposited to your bank accounts.
But what about safety? And can electronic filing really provide 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 us look at the advantages of e-filing, and whether it might be the very best filing option for your needs.
If you are thinking about e-filing, a Few of the advantages include:
- Quick affirmation your forms have been received: The IRS will confirm a tax filing has been 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 publish a paper filing, it can take six to eight months to be given a tax refund. With e-filing, you’ll receive your money in 3 weeks or less. Choosing direct deposit can also speed up the refund process.
Reduced chance of mistakes: According to the IRS, there’s approximately 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 returns.
Easy payment process: If you owe the IRS money, it is easier 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. Additionally you have the choice to pay your balance by using the IRS Immediate 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.
Digital storage of taxation information: Submitting returns electronically implies there’s an electronic copy of your tax documents. 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 process of doing this is easy.
How to e-file a tax return?
You have four options for filing an electronically filed tax return to the IRS.
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you could have the ability to use the IRS Free File program. The types do the math for you and offer standard guidance. You can simply do your federal return with these kinds.
- Utilize an online tax preparation service or tax software: Tax preparation software and online filing services are alternatives. These choices are an easy way to complete and e-file your forms. Some applications suppliers charge for their programs, Some are free. The software asks you simple questions about your life and finances to steer you through the completion of your types.
- Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields. But eligibility for free aid is normally restricted based on earnings, and some services cater to particular demographic groups.
- Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re authorized IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this option is very likely to be the most costly one.
Employing online tax prep software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it expected over four in five tax returns to be filed through tax return prep software.
Is e-filing really secure?
While e-filing is suitable, you may be worried about security — particularly with so many data breaches. But experts agree this is not an issue that should dissuade you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and sales at LegalShield. “In fact, it may be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has put security measures in place to keep your information secure. “Trainers normally use IRS specific APIs that require token sessions,” Chow says. “All this is routed over TLS encrypted connections.”
It’s important to use a trustworthy service that will assist you file your taxes. Chow advises to not e-file on a computer or use an internet connection that is not confidential.
For most taxpayers, it is sensible 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 options. Just be certain that you use tax planning software from a trusted source, so that you may ensure the information which you provide to transmit to the IRS is going to be kept secure.