Is e-filing really a much better way to record your taxes?
Americans and the IRS may not agree on everything, but they are mostly on the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns submitted to the IRS are e-filed.
When you e-file your federal income tax return, you save the IRS money because its workers do not have to spend time manually processing your return. In return, you could find any refund you are owed faster, particularly 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 in case you’ve got a complex tax situation? Are there situations when you can not e-file? Let us look at the advantages of e-filing, and if it might be the best filing choice for your needs.
If you are Considering e-filing, some of the advantages include:
- Quick affirmation your forms are obtained: The IRS will affirm a tax filing has been received within one day of electronic submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely.
Timely refunds: When you publish a paper filing, it can take six to eight weeks to be given a tax refund. With e-filing, you are going to get your money in three weeks or less. Choosing direct deposit can also speed up 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% rate of mistakes on paper filings. The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.
Simple payment procedure: If you owe the IRS money, it is simpler to pay at your advantage if 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. 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. Additionally you have the option to pay your balance by using the IRS Immediate pay service from your checking account or savings accounts, 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’s a digital copy of your tax documents. So if something happens to your paperwork, then you will have an electronic backup.
The good news: Most taxpayers do decide to e-file and find those benefits — and the practice of doing this is easy.
The way to e-file a tax return?
You have four options for submitting an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the favored 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 stable?
While e-filing is convenient, you may worry about safety — particularly with so many data breaches. But experts agree this isn’t 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 sales at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your information in the email.”
Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set safety measures in place to keep your data safe. “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says. “All of this can be routed over TLS encrypted links “
It’s important to employ a trusted service to assist you record your taxes. Chow advises not to e-file on a public computer or use an internet connection that is not confidential.
For many taxpayers, it makes sense to e-file a yield 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 make sure to use tax planning software from a trusted source, so you can ensure the information which you supply to transmit to the IRS will be kept protected.