Is e-filing a better way to file your taxes?
Americans and the IRS might not agree on everything, but they’re mostly on 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.
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 accounts.
But what about security? And can digital filing actually provide you access to all of the forms that you may need in case you have a complex tax situation? Are there situations when you can not e-file? Let us look at the advantages of e-filing, and whether it might be the best filing option for your requirements.
If you’re thinking about e-filing, a Few of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will affirm a tax filing has been received within 24 hours of digital submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may take six to eight months to receive a tax refund. With e-filing, you’ll get your money in 3 weeks or less. Choosing direct deposit may also speed up the refund procedure.
Reduced likelihood of mistakes: According to the IRS, there’s approximately a 1 percent error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Easy payment process: If you owe the IRS money, it’s easier to pay at your convenience when you e-file. You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline. And you’re able to schedule electronic money transfers to send the IRS what you owe on a date of your choosing — again, as long as the IRS receives your payment by Tax Day. You also have the choice to pay your balance by using the IRS Direct pay service from your checking or savings account, 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) can result in interest and penalties.
Digital storage of taxation data: 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 benefits — and the practice of doing so is easy.
The way to e-file a tax return?
You have four choices 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 be able to use the IRS Free File program. The types do the math for you and provide standard advice. You can only do your federal return with all these kinds.
- Utilize an online tax preparation service or tax applications: Tax preparation software and online filing services are options. These choices are a simple way to complete and e-file your forms. Some software providers charge for their programs, Some are liberated. The software asks you simple questions about your life and finances to steer you through the completion of your types.
- Get complimentary, in-person tax help: 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 specific demographic groups. The IRS maintains a database of authorized providers, but be aware this option 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 over four tax returns to be submitted through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you may worry about safety — particularly with all these data breaches. But experts agree that this is not a problem that should dissuade you from 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 leadership, advertising and sales at LegalShield. “In actuality, it may 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 information security at SCIS Security, clarifies the IRS has put safety measures in place to keep your data safe. “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted links .”
It’s important to use a trusted service to assist you file your taxes. Chow advises not to e-file on a public computer or utilize an internet connection which is not private.
For most taxpayers, it makes sense to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just be sure to use tax planning software from a trusted source, so that you can make certain the information you supply to transmit to the IRS will be kept secure.