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IRS Urges Taxpayers to E-file – It’s Safe and Beneficial!

(ARA) – According to the Internal Revenue Service (IRS), the number of electronically filed tax returns surpassed a record in 2006 when more than 73 million tax returns, almost 54 percent of all individual federal income tax returns, were e-filed. Approximately 53 million returns came from tax professionals. More than 20 million taxpayers used software e-filing services from their home computers — up 36 percent as compared to the prior year.

But just how secure is the IRS’ e-file system? Perhaps the most revealing is that, as of 2006, more than 700 million tax returns have been filed electronically since 1986 with no security incidents. In a nutshell, it is safe!

Yet, while there is a substantial portion of taxpayers who use tax preparation software to prepare their return — a surprising number of these filers opt to print and mail their tax forms rather than using e-file.

‘There are two predominate explanations why those who use tax software to prepare their return opt to mail rather than e-file their taxes. In some instances, taxpayers may have a lingering distrust of technology — concerned the privacy of their data may be compromised. Still there are other taxpayers who simply feel their tax software service provider charges too much for e-filing tax data to the IRS,’ says Stephanie Behrends, spokesperson for 2nd Story Software, Inc., makers of the popular TaxACT tax preparation software and Web-based services.

Behrends continues, ‘The reality is that e-filing eliminates most opportunities for mistakes and enables filers entitled to a tax refund to receive it faster. It actually increases a filer’s control over their tax data because of the security and safeguards in place.’

Indeed, when you e-file your taxes, there are a number of advantages.

  • Convenience. You can electronically file 24 hours a day, 7 days a week — anywhere you have access to a computer.
  • Security. Your tax return information is encrypted and transmitted over secure lines to ensure confidentiality.
  • Accuracy. With a reported error rate of less than one percent by the IRS, electronically filed returns have far fewer errors than paper returns. Conversely, the IRS reports up to a 20 percent error rate for paper returns.
  • Proof of Filing — E-filing your tax return will provide you with an Electronic Postmark — also referred to as an Acknowledgement. When you e-file your taxes, you’ll receive an e-mail — within 24 to 48 hours — acknowledging the IRS has received your return and that it will be processed.
  • Improved Communication. If an error is detected by the IRS (e.g. a SSN does not correspond with the taxpayer’s name on record), error codes can be communicated faster and more efficiently. In most cases, Error Code Explanations supplied by the IRS and your tax software provider can identify the location of the error in the tax return and provide complete information with regards to how you can make the correction.
  • Faster Refunds. E-filing your tax return gives you the added advantage of receiving your tax refund in half the time it would take if you mailed a paper return. And, if you use Direct Deposit, you can receive your money in as few as 10 days.

But what about the high fees that some tax software companies charge to e-file your taxes? Behrends reveals not all software companies charge these fees. ‘TaxACT is a very unique tax preparation product. TaxACT Standard (Online or software download for Windows) is completely free tax software that enables all taxpayers to prepare, print and e-file a federal tax return — no gimmicks, no rebates, no restrictions.’

Are you thinking about using tax software to file your taxes — helping you to conserve time, save money, and avoid making costly mistakes? Still have questions about e-file? Visit www.IRS.gov/efile for more information. More information regarding TaxACT may be found by visiting www.TaxACT.com.

Courtesy of ARAcontent