This option is growing each year in popularity. There are significant benefits that may lead you to give up pen and paper. Accuracy, speed, and security are among the chief benefits of electronically filing your income tax return, reports the Colorado Society of CPAs.
Less than 1 percent of electronically prepared returns contain errors as compared to roughly 20 percent of paper returns. That's because, in most cases, electronic tax filing software does the math for you and alerts you to potential errors before you file. With e-filing, there's no need to worry about your return getting lost in the mail. Generally, within two business days of receiving your return, the IRS will acknowledge its receipt. Finally, if you're owed a refund, you're likely to get it faster.
The IRS website has lots of useful "how to" information about e-filing. It explains how to choose a PIN (personal identification number) as your signature and how to have your refund deposited directly into your account. However, to actually file the return you must visit any one of a number of commercial sites that make this service available for a fee or buy a commercial software program like TurboTax. The Web sites are usually cheaper but the desktop software may have more features to help you fill out your return.
The IRS website does list a number of sites that offer free e-filing programs for low-income families, teenagers and others.
There is also an individual e-file checklist.
IRS Free File
Many companies offer discounted or free filing services, if you link to them through the IRS.gov Free File section. Once you select a free-file provider, you are asked tax-related questions and based on your answers, guided through the process of filling out your return. It's an alternative to buying over-the-counter tax software. In some cases, you may need to earn less than certain income ceilings. In other cases, the service is open to any taxpayer. In some cases, the federal tax return is free, but you will be charged for your state return.
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