Is e-filing a better way to file your taxes?
Americans and the IRS might not agree about everything, but they are largely on precisely the 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 get any refund you are owed quicker, particularly if you have it directly deposited to your bank account.
However, what about safety? And can digital filing really give you access to all of the forms you may need if you’ve got a intricate 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 best filing option for your needs.
If you’re thinking about e-filing, some of the advantages include:
- Quick affirmation your forms have been received: The IRS will affirm a tax filing has been received within one day of electronic submission. For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely.
Timely refunds: When you publish a paper filing, it can take six to eight months to receive a tax refund. With e-filing, you’ll get your money in 3 weeks or less. Choosing direct deposit can also speed up the refund process.
Reduced likelihood of mistakes: In accordance with the IRS, there is approximately a 1% error rate on e-filed yields, compared with a 20% rate of errors on paper filings. The IRS also provides more info on problems discovered on e-filed returns compared with paper returns.
Simple payment process: If you owe the IRS money, it’s easier to cover at your convenience if you e-file. It’s possible to submit returns early and pay later if needed, as long as you pay from 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 account, filing 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) can lead to penalties and interest.
Digital storage of taxation data: Submitting returns electronically means there’s a digital copy of your tax records. So if something happens to your paperwork, you will have a digital backup.
The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing so is easy.
How to e-file a tax return?
You have four choices for submitting an electronically filed tax return to the IRS.
The types do the math for you and provide standard advice. You can only do your federal return with these forms.
Using online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it expected more than four tax returns to be submitted through tax return prep software.
Is e-filing really secure?
While e-filing is convenient, you could be worried about safety — particularly with so many data breaches. But experts agree that this isn’t an issue that should deter you by e-filing.
“E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In fact, it may be more secure than paper filing as you’re sending your personal information through an encrypted system rather than exposing your information in the email.”
Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has put security measures in place to keep your data secure. “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says. “All this is routed over TLS encrypted connections”
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 use an internet connection that is not confidential.
For many taxpayers, it makes sense to e-file a yield since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices. Just be sure to use tax preparation software from a dependable source, so you can make certain the information you provide to transmit to the IRS is going to be kept protected.