Is e-filing really a better way to file your taxes?
Americans and the IRS may not agree about everything, but they’re largely on precisely the same page when it comes to e-filing individual income tax returns.
Nearly all individual income tax returns filed to the IRS are e-filed. E-filing is popular as it is a win-win for taxpayers and the IRS.
When you e-file your federal income tax return, you save the IRS cash because its workers don’t have to spend time manually processing your return. And in return, you could get any refund you’re owed faster, especially in the event that you have it directly deposited to your bank account.
However, what about safety? And can digital filing really give you access to all the forms that you may need in case you have a complex tax situation? Are there ever situations when you can not e-file? Let’s look at the benefits of e-filing, and if it might be the best filing choice for your requirements.
If you are thinking about e-filing, some of the advantages include:
- Quick confirmation your forms have been obtained: The IRS will confirm a tax filing has been received within 24 hours 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 be given a tax refund. With e-filing, you are going to get your money in three weeks or less. Choosing direct deposit may also speed up the refund process.
Reduced chance of errors: According to the IRS, there is approximately a 1% error rate on e-filed returns, compared with a 20% rate of errors on paper filings. The IRS also provides more info on issues discovered on e-filed returns compared with paper yields.
Easy payment process: If you owe the IRS money, it is easier to cover at your advantage if you e-file. You can submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from the checking or savings accounts, submitting 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 means there is an electronic backup of your tax records. So if something happens to your paperwork, then you will have a digital backup.
The good news: Most taxpayers do opt to e-file and get those benefits — and the process of doing so is simple.
The way to e-file a tax return?
- Use IRS Free File: If your adjusted gross income is $72,000 or not as you could be able to use the IRS Free File program.
- Free File Fillable Forms — If your income is more than $72,000 and you are comfortable doing your earnings without any assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide basic advice. You can only do your federal return with all these forms.
- Utilize an internet tax preparation tax or service applications: Tax preparation software and online filing services are options. These options are a simple way to complete and e-file your own forms. Some software suppliers charge for their programs, Some are liberated. The software asks you simple questions about your own life and finances to steer you through the completion of your forms.
- Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns. However, eligibility for free aid is normally restricted based on income, and some providers cater to specific demographic groups. The IRS maintains a database of authorized providers, but you should be aware this option is likely to be the most costly one.
Using online tax prep software is far and away the preferred approach of the majority of taxpayers. Actually, the IRS says it anticipated over four in five tax returns to be filed through tax return prep program.
Is e-filing really secure?
While e-filing is suitable, you could be worried about security — particularly with all these data breaches. But experts agree this isn’t a problem which should dissuade you from e-filing.
“E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the mail.”
Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has set security measures in place to keep your information secure. “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says. “All of this is routed over TLS encrypted connections”
It is very important to employ a trustworthy service that will assist you file your taxes. Chow advises not to e-file on a public computer or use an internet connection which is not private.
For many taxpayers, it is sensible to e-file a yield since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices. Just make sure to use tax planning software from a dependable source, so that you can ensure the information which you provide to transmit to the IRS will be kept secure.