Should You E-File Your Taxes Or Not?
As the internet becomes increasingly ubiquitous, it has become more common to e-file your taxes. Though many still debate whether it is better to file in person. In time, the IRS has slowly started to promote e-filing, paving the way for this method to largely replace paper filing. In this article, we will explore the pros and cons of e-filing vs paper filing.
The Advantages of E-Filing
- Convenience and accuracy
E-filing has grown in popularity for its most clear benefit: it saves you a trip to the post office. When e-filing, you can submit your taxes online through the IRS website. Furthermore, e-filing allows you to catch any errors before filing. This attention to detail saves you from dealing with misprinted information further down the line.
- Fast turn around
Once taxes have been e-filed, the taxpayer is notified in about a day that their return has been accepted, thus minimizing the agony of waiting to hear back. Any taxes that you owe can be conveniently transferred from your bank or submitted via check.
- Direct refunds
After filing, the process of acceptance and receiving your return is relatively swift. You can choose to have your refund deposited directly to your bank account, which is safer than receiving a check in the mail.
The Disadvantages of E-Filing
- E-Filing is not always an option
There are instances in which e-filing is either not possible or does not best suit your situation. Some instances that may exclude you from e-filing include, taking adoption tax credits, or first-time homebuyer credits. Or, if power of attorney is required in your case, e-filing might not best suit your needs.
- Security risks
While the internet may feel safe at times, it can be less secure than directly handing off a hard paper file of your taxes. It is important to be wary of the chance of an internet security breach. Additionally, it is important to make sure you are using a trustworthy and IRS approved vendor.
- Chances of audit
While there is no hard evidence connecting e-filing to being audited, a 2009 report from Congress’s Joint Tax Committee suggested that there may be a link, stating cost cuts would enable the IRS to “make use of its computer infrastructure to target returns with audit potential.”