Nowadays, it seems like you can do almost anything electronically, and that includes filing your taxes. If you're wondering how to e-file your federal tax return, it's a simple matter of going online and either using commercial software or taking advantage of the IRS Free File tool, which is available to those whose income is $64,000 a year or less. While you may be used to paper, consider these three benefits of filing taxes electronically when you sit down to tackle your next return.
1. You'll get your refund faster
Almost 80% of U.S. tax filers get some sort of refund each year. If you're one of them, you're no doubt better off getting your hands on that money sooner rather than later. That's why it pays to file your taxes electronically. The IRS reports that it typically takes three weeks or less to issue refunds for tax returns filed electronically. File electronically and sign up for direct deposit, and you could see your refund even sooner. On the other hand, if you file a paper tax return, it could take anywhere from six to eight weeks to get your money back -- that's almost the double the wait.
Not only will you get your refund faster by filing electronically, but you'll also have an easier time keeping tabs on it. Electronic tax filers can check their refund status within 24 hours of submitting a return. If you mail in a physical return, you'll generally need to wait a good four weeks before refund information becomes available.
2. You're less likely to make a mistake
We're all human, and sometimes even the most diligent tax filers make a mistake by transposing numbers or miscalculating key figures. Another major benefit of filing taxes electronically is that you're less likely to mess up your math. The IRS reports that the error rate for paper returns is a whopping 21%. The error rate for electronic returns, on the other hand, is less than 1%. Making a mistake on your taxes can delay your refund, among other things, so you're better off taking human error out of the equation to the greatest extent possible.
3. It's more convenient
One final reason to file your taxes electronically this year is that you're likely to save yourself time, aggravation, and stress. When you file your return electronically, you'll know that it was submitted. You won't find yourself lying awake at night worrying that your sensitive financial documents somehow got lost in the mail. Furthermore, electronic tax filers get certain flexibilities that paper filers don't. For example, if you owe money on your taxes and file early to get your return off your plate, you can set up an automatic payment for any day up until the April 15 deadline. This way, you'll avoid having to part with your money earlier than necessary.
Filing taxes electronically is a good way to avoid mistakes on your taxes and, just as important, get your hands on your refund as quickly as possible. Whether you're planning to file your own taxes this year or use a professional, it pays to submit an electronic return and eliminate much of the hassle during an otherwise stressful time of the year.