Is e-filing really a much better way to file your taxes?
Americans and the IRS might not agree on everything, but they are mostly 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 is a win-win for taxpayers and the IRS.
If you e-file your federal income tax return, you save the IRS money because its workers don’t have to spend time manually processing your return. And in return, you can get any refund you are owed faster, particularly if you have it directly deposited to your bank accounts.
But what about safety? And can digital filing really provide you access to all of the forms that you may need in case you’ve got a intricate tax situation? Are there ever situations when you can’t e-file? Let us look at the benefits of e-filing, and whether it might 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 affirm a tax filing has been received within 24 hours of digital submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you submit a paper filing, it may take six to eight weeks to be given a tax refund. With e-filing, you’ll get your money in three weeks or less. Choosing direct deposit may also accelerate the refund procedure.
Reduced likelihood of errors: In accordance with the IRS, there is around 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 problems discovered on e-filed returns compared with paper yields.
Simple payment process: If you owe the IRS money, it is easier to pay at your advantage if you e-file. You can submit returns early and pay afterwards if needed, as long as you pay from the April 15 filing deadline. You also have the option to pay your balance by using the IRS Direct pay service from the checking account or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order. Just be aware delaying payment following the filing due date (typically April 15) will lead to interest and penalties.
Digital storage of taxation information: Submitting returns electronically means there is 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 get those benefits — and the process of doing this is easy.
You have four options for filing an electronically filed tax return to the IRS.
The forms do the math for you and offer standard advice. You can simply do your federal return with these forms.
Employing online tax preparation software is far and away the preferred approach of most taxpayers. In fact, the IRS says it anticipated more than four in five tax returns to be filed through tax return prep program.
Is e-filing really stable?
While e-filing is convenient, you could worry about security — particularly with all these data breaches. But experts agree that this isn’t a problem which should deter you from e-filing.
“In actuality, it can be more secure than paper filing as you’re sending your personal information through an encrypted network as opposed to exposing your information in the email.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has put safety measures in place to keep your data safe. “Trainers normally use IRS particular APIs that require ab sessions,” Chow says. “All of this can be routed over TLS encrypted links “
It is important to use a trustworthy service that will help you record your taxes. Chow advises to not e-file on a computer or utilize an internet connection which is not confidential.
For most taxpayers, it makes sense to e-file a return because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just be certain that you use tax planning software from a trusted source, so that you can make certain the information which you provide to transmit to the IRS will be kept secure.