Have you put off filing your tax return this year and are currently on an extension? If so, you may want to read the reasons the IRS recommends filing electronically so you can be prepared to speak with your CPA about this option.
IRS e-file: It’s safe. It’s easy. It’s time. Most taxpayers—nearly 80 percent– file electronically. If you haven’t tried it, now is the time! The IRS has processed more than 1 billion individual tax returns safely and securely since the nationwide debut of electronic filing in 1990. Last year, 112 million people – 78 percent of all individual taxpayers – used IRS e-file to electronically transmit their tax returns to the IRS. The number of people who use a paper tax return or who mail a tax return dwindles each year – and for good reason.
- 1. Safety and security. E-file providers must meet strict guidelines and provide the best encryption technology. You receive an acknowledgment within 48 hours that the IRS received your return. If the IRS rejects the return, the receipt will explain why so you can quickly correct and resubmit.
- 2. Faster refunds. An e-filed tax return normally means a fast refund. If you combine e-file and direct deposit the IRS can typically issue your refund in as few as 10 days. About three out of four taxpayers receive a refund and last year the average refund was approximately $2,900.
- 3. More payment options. If you e-file you can file early and set an automatic payment withdrawal date for any date on or before the due date. You may also pay by paper check or even by credit card. Keep in mind if you are on an extension and owe money, the tax was due back in April, so you most likely will be assessed a penalty and interest for not paying timely.
- 4. It’s easy. You can e-file through your tax preparer, use commercial tax preparation software or through Free File, the free tax preparation and e-filing service available exclusively at www.irs.gov.
Make sure you have your tax information to your CPA in plenty of time for them to prepare your return, and have it filed electronically for a faster refund (if applicable).
