Is e-filing a better way to file your taxes?
Americans and the IRS may not agree on everything, but they are largely on the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed. E-filing is popular because it’s a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you save the IRS cash because its workers don’t need to spend time manually processing your return. In return, you can get any refund you are owed faster, especially in the event that you have it directly deposited into your bank accounts.
However, what about safety? And can electronic filing actually give you access to all the forms you may need if you’ve got 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 very best filing choice for your requirements.
If you’re thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are 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 that your forms have arrived .
Timely refunds: When you submit a paper filing, it may take six to eight months to be given a tax refund. With e-filing, you are going to get your money in 3 weeks or less. Choosing direct deposit can also speed up the refund procedure.
Reduced likelihood of errors: In accordance with the IRS, there’s around a 1% 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 returns compared with paper returns.
Simple payment process: If you owe the IRS money, it’s simpler to cover at your advantage if you e-file. You can submit returns early and pay afterwards if necessary, provided that you pay from 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, provided that the IRS receives your payment by Tax Day. You also have the option to pay your balance by using the IRS Direct 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 information: Submitting returns electronically means there is an electronic backup of your tax records. If something happens to your paperwork, then you will have an electronic backup.
The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is easy.
How to e-file a tax return?
- Utilize 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 provide standard advice. You can simply do your federal return with these forms.
- Use an online tax preparation service or tax software: Tax preparation software and online filing services are options. These options are an easy way to finish and e-file your forms. Some applications providers charge for their programs, Some are liberated. The program asks you simple questions about your own life and financing to steer you through the completion of your types.
- Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns. However, eligibility for free aid is typically limited based on earnings, and some services cater to specific demographic groups. For 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 you should be aware this option is very likely to be the most costly one.
Employing online tax preparation software is far and away the preferred approach of the majority of taxpayers. In fact, the IRS says it expected more than four tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could worry about safety — especially with all these data breaches. But experts agree that this is not a problem that should dissuade you by e-filing.
“E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and revenue at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your private 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 that the IRS has set safety measures in place to keep your information secure. “Vendors typically utilize IRS specific 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 that will help you file your taxes. Chow advises not to e-file on a computer or use an internet connection that isn’t confidential.
For most taxpayers, it is sensible to e-file a return since it is the most convenient way to submit 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 dependable source, so you can make certain the information which you supply to transmit to the IRS is going to be kept protected.