Is e-filing a better way to record your taxes?
Americans and the IRS may not agree on everything, but they are 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.
When you e-file your federal income tax return, you conserve the IRS cash because its employees don’t have to spend time manually processing your return. And in return, you can find any refund you are owed faster, especially in the event that you have it directly deposited into your bank account.
However, what about safety? And can electronic filing actually provide you access to all of the forms you might need in case you have a complex tax situation? Are there 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 needs.
If you’re Considering e-filing, some of the advantages include:
- Quick affirmation your forms are received: The IRS will confirm a tax filing has been received within 24 hours 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 may take six to eight months to be given a tax refund. With e-filing, you are going to receive your money in three weeks or less. Choosing direct deposit can also accelerate the refund procedure.
Reduced chance of mistakes: In accordance with 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 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 pay at your convenience when you e-file. You can submit returns early and pay afterwards if needed, provided that you pay by the April 15 filing deadline. You also have the choice to pay your balance by using the IRS Direct pay service from your checking account 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 lead to penalties and interest.
Digital storage of taxation data: Submitting returns electronically implies there is a digital backup of your tax records. If something happens to your paperwork, you will have an electronic backup.
The good news: Most taxpayers do decide to e-file and get those benefits — and the process of doing this is simple.
How to e-file a tax return?
The forms do the math for you and provide standard advice. You can only do your federal return with these forms.
Using online tax preparation software is far and away the favored approach of the majority of taxpayers. Actually, the IRS says it anticipated more than four tax returns to be submitted through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you could worry about security — especially with so many data breaches. But experts agree this is not a problem that should dissuade you by e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and sales at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your information in the email.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has put security measures in place to keep your data safe. “Trainers normally use IRS specific APIs that need ab sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It’s very important to employ a trusted service that will assist you record your taxes. Chow advises not to e-file on a computer or use an internet connection which is not private.
For most taxpayers, it makes sense to e-file a return since it’s 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 dependable source, so that you may ensure the information you provide to transmit to the IRS will be kept protected.