Is e-filing a better way to record your taxes?
Americans and the IRS might not agree about everything, but they’re largely on the exact same page in regards to e-filing individual income tax returns.
The majority of individual income tax returns submitted to the IRS are e-filed.
In return, you could 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 actually provide you access to all of the forms you might need if you’ve got a intricate tax situation? Are there situations when you can not e-file? Let’s look at the advantages of e-filing, and if it might be the very best filing choice for your needs.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are received: The IRS will affirm a tax filing was received within one day of digital submission. For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely.
Timely refunds: When you submit a paper filing, it can take six to eight weeks to receive 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 errors: According to the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings. The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.
Easy payment process: If you owe the IRS money, it is simpler to pay at your convenience when you e-file. You can 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 using the IRS Direct 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 taxation data: Submitting returns electronically implies there’s an electronic copy of your tax records. So if something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing this is simple.
You have four choices for filing an electronically filed tax return to the IRS.
Using online tax preparation software is far and away the preferred approach of most taxpayers. Actually, the IRS says it anticipated more than four in five tax returns to be filed through tax return prep software.
Is e-filing really stable?
While e-filing is convenient, you could worry about security — especially with so many data breaches. But experts agree this is not a problem which should deter you from e-filing.
“In fact, it can be more secure than paper filing as you’re sending your personal information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, explains the IRS has put security measures in place to keep your information secure. “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says. “All this is routed over TLS encrypted links .”
It is important to use a trustworthy service to assist you record your taxes. Chow advises to not e-file on a computer or use an online connection which isn’t private.
For many taxpayers, it is sensible to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just be sure to use tax planning software from a dependable source, so that you can make certain the information you supply to transmit to the IRS will be kept protected.