Is e-filing a better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re largely on the exact same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns filed to the IRS are e-filed. E-filing is popular as it’s a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you conserve the IRS cash because its workers do not need to spend time manually processing your return. In return, you can find any refund you’re owed quicker, particularly in the event that you have it directly deposited to your bank account.
But what about safety? And can electronic filing really provide you access to all of the forms that you may need in case you have a intricate tax situation? Are there ever situations when you can not e-file? Let us look at the benefits of e-filing, and whether it might be the best filing option for your requirements.
If you’re Considering e-filing, a Few of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within one day of digital submission. For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely.
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 receive your money in three weeks or less. Choosing direct deposit can also speed up the refund procedure.
Reduced likelihood of mistakes: According to the IRS, there is around 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 yields compared with paper yields.
Simple payment procedure: If you owe the IRS money, it is simpler to cover at your convenience when you e-file. It’s possible to submit returns early and pay later if necessary, 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 the checking or savings account, filing a credit card through a payment processor for a fee, 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 tax information: Submitting returns electronically implies there’s a digital copy of your tax records. So if something happens to your paperwork, you’ll have a digital backup.
The good news: Most taxpayers do opt to e-file and find those benefits — and the process of doing this is simple.
The forms do the math for you and offer basic advice. You can simply do your federal return with all these forms.
Using online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it anticipated over four tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is convenient, you could be worried about security — 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 direction, advertising and sales at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your data in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has put safety measures in place to keep your data secure. “Trainers normally use IRS particular APIs that need ab sessions,” Chow says. “All of this is routed over TLS encrypted links .”
It is important to use a trusted service to help you record your taxes. Chow advises not to e-file on a computer or use an online connection that isn’t private.
For most taxpayers, it makes sense 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 effortless payment choices. Just be sure to use tax preparation software from a dependable source, so you may ensure the information which you supply to transmit to the IRS will be kept protected.