The IRS can process e-file returns faster and with fewer errors than non-electronic options. This means quicker refunds and less contact with the IRS. Who doesn’t like that? IRS e-file provides proof of receipt within 24-48 hours of sending the tax return to the IRS. Individual and business clients can e-file a balance due return and schedule an electronic funds transfer (EFT) from their account for any date.
IRS computers quickly and automatically check for errors and other missing information when you e-file. You can sign and file a completely paperless return, saving time and money. No trips to the post office at the last minute!
Processing of e-file returns is also faster and more accurate than the processing of paper returns. However, as with a paper return, you are responsible for making sure your return contains accurate information and is filed in a timely manner. The chance of being audited does not differ whether you e-file or file by paper.
Using direct deposit to receive your income tax refund is quick and safe, and there is no risk of a paper check getting lost or stolen. It is easy to choose this delivery method whether you use a tax preparer or file your own taxes.
A great direct deposit option is to split your refund into multiple accounts. Account types where refunds can be directed include checking, savings, health, education, and certain retirement accounts. You can direct your refund to any of these account types with a U.S. financial institution as long as your financial institution accepts direct deposits for that account type and you provide valid routing and accounting numbers for the accounts.
Splitting your refund will not cause a delay in receiving the refund. In fact, because it uses electronic fund transfer technology, your refund will be in your account(s) faster than if you opt to receive a paper check. This is the same electronic transfer system that deposits nearly 98 percent of all Social Security and Veteran affairs benefits into millions of accounts. Currently, it is estimated that 8 out of 10 taxpayers use direct deposit for their refunds.
If you need assistance filing your taxes, contact us one of the tax professionals at HBP for help today!
Written by Norma Hill, Senior Tax Accountant