Is e-filing really a better way to record your taxes?
Americans and the IRS may not agree on everything, but they’re mostly on precisely the exact same page when it comes to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
In return, you can get any refund you’re owed quicker, particularly if you have it directly deposited to your bank accounts.
But what about security? And can electronic filing really give you access to all of the forms you may need in case you’ve got a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and whether it might be the best filing option for your needs.
If you’re Considering e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within 24 hours of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment 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’ll receive your money in three weeks or less. Choosing direct deposit can also accelerate the refund process.
Reduced chance of errors: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% speed of errors on paper filings. The IRS also provides more info on issues discovered on e-filed returns compared with paper returns.
Easy payment procedure: If you owe the IRS money, it is easier to pay at your advantage when you e-file. It’s possible to submit returns early and pay afterwards if necessary, provided that you pay by the April 15 filing deadline. You also have the choice to pay your balance by making use of the IRS Immediate pay service from your checking 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 after the filing due date (typically April 15) will result in interest and penalties.
Digital storage of tax data: Submitting returns electronically implies there is an electronic copy 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 find those advantages — and the process of doing this is easy.
Using online tax preparation software is far and away the favored approach of the majority of 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 secure?
While e-filing is suitable, you may be worried about safety — especially with all these data breaches. But experts agree this isn’t a problem which should dissuade you by e-filing.
“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and revenue at LegalShield. “In fact, it may be more secure than paper filing as 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, clarifies that the IRS has set security measures in place to keep your information safe. “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted connections”
It is important to use a trusted service that will assist you file your taxes. Chow advises to not e-file on a public computer or use an internet connection which isn’t confidential.
For most taxpayers, it is sensible to e-file a return 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 be certain to use tax planning software from a trusted source, so that you may make certain the information which you supply to transmit to the IRS will be kept secure.