Is e-filing really a better way to record your taxes?
Americans and the IRS might not agree on everything, but they’re largely on the same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
And in return, you could get any refund you’re owed faster, especially if you have it directly deposited into your bank account.
However, what about security? And can electronic filing actually give you access to all of the forms that you might need in case you have a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and if it may be the very best filing choice for your requirements.
If you are Considering e-filing, a Few of the advantages include:
- Quick affirmation your forms have been obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
Timely refunds: When you submit 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 accelerate the refund process.
Reduced chance of errors: In accordance with the IRS, there’s approximately a 1% error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more information on issues discovered on e-filed yields compared with paper returns.
Easy payment process: If you owe the IRS money, it’s simpler to pay at your convenience when you e-file. You can submit returns early and pay later if needed, provided that you pay by the April 15 filing deadline. You also have the choice to pay your balance by making use of the IRS Immediate pay service from the checking account or savings account, filing 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 a digital backup of your tax documents. So if something happens to your paperwork, then you’ll have an electronic backup.
The good 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?
- Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may be able to use the IRS Free File program. The types do the math for you and offer basic guidance. You can only do your federal return with all these forms.
- Use an internet tax preparation tax or service applications: Tax preparation software and online filing services are options. These options are an easy way to complete and e-file your forms. Some software providers charge for their apps, Some are free. The software asks you simple questions about your own life and finances to guide 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. However, eligibility for free help is typically limited based on income, and a few services cater to particular demographic groups. By way of instance, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older. The IRS maintains a database of licensed providers, but be aware this alternative is likely to be the most costly one.
Using online tax preparation 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 software.
Is e-filing really stable?
While e-filing is suitable, you could be worried about security — particularly with so many data breaches. But experts agree this is not a problem which should dissuade you by e-filing.
“In fact, it can be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has set safety measures in place to keep your data secure. “Trainers normally use IRS specific APIs that need token sessions,” Chow says. “All this can be routed over TLS encrypted connections.”
It is important to use a trusted service that will help you file your taxes. Chow advises not to e-file on a public computer or utilize an online connection that isn’t private.
For many taxpayers, it is sensible to e-file a yield 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 be sure to use tax preparation software from a trusted source, so that you can ensure the information which you supply to transmit to the IRS will be kept secure.