Is e-filing a better way to record your taxes?
Americans and the IRS might not agree on everything, but they are largely on the exact same page in regards to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed.
In return, you can find any refund you’re owed faster, particularly in the event that you have it directly deposited into your bank account.
However, what about security? And can electronic filing actually provide you access to all the forms that you might need if you have a complex tax situation? Are there situations when you can’t e-file? Let us look at the advantages of e-filing, and if it might be the very best filing choice for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms are obtained: The IRS will affirm a tax filing was received within one day of electronic submission. For paper filers, the IRS does not send any acknowledgment your forms have arrived .
Timely refunds: When you submit a paper filing, it can take six to eight months to receive a tax refund. With e-filing, you are going to receive your money in three weeks or not. Choosing direct deposit can also speed up the refund process.
Reduced chance of errors: In accordance with the IRS, there is approximately a 1 percent error rate on e-filed returns, compared with a 20% speed of mistakes on paper filings. The IRS also provides more info on issues discovered on e-filed yields compared with paper returns.
Easy payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file. It’s possible to submit returns early and pay afterwards if needed, as long as you pay from the April 15 filing deadline. And you’re able to schedule electronic money transfers to easily send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. Additionally you have the option 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 commission, or paying by check or money order. Just be aware delaying payment after the filing due date (typically April 15) will lead to interest and penalties.
Digital storage of tax data: Submitting returns electronically implies there is a digital backup of your tax records. If something happens to your paperwork, then you’ll have an electronic backup.
The good news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is easy.
The forms do the math for you and offer basic advice. You can simply do your federal return with these kinds.
Using online tax preparation software is far and away the favored approach of most taxpayers. Actually, the IRS says it expected over four tax returns to be submitted through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could be worried about safety — especially with so many data breaches. But experts agree this is not a problem that should deter you from e-filing.
“In fact, it can be more secure than paper filing since you’re sending your private information through an encrypted network rather than exposing your information in the mail.”
Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set safety measures in place to keep your information safe. “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says. “All this can be routed over TLS encrypted links .”
It is important to employ a trustworthy service that will help you record your taxes. Chow advises to not e-file on a computer or utilize an internet connection that isn’t private.
For many taxpayers, it makes sense to e-file a yield since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options. Just make sure to use tax planning software from a trusted source, so you can ensure the information you supply to transmit to the IRS will be kept protected.