Benefits & Disadvantages of Filing Your Taxes Electronically

by Cynthia Myers, Demand Media
    Filing taxes electronically could save you time.

    Filing taxes electronically could save you time.

    The IRS encourages taxpayers to file tax returns electronically, whether you do your taxes yourself or pay someone to figure them for you. You can send your taxes via the IRS’s Free File portal, or use tax software that will allow you to submit your return electronically. While filing your taxes electronically can have several advantages, the option is not without its disadvantages. Weigh the pros and cons to make the right tax choice for you.

    Faster Refund

    The IRS claims you’ll receive your refund faster if you file your taxes electronically. You skip the time your printed form would spend in transit in the mail. Also, since electronic tax forms go directly into the IRS’s computer system, you don’t have to wait for a clerk to enter your information into the computer manually. If you’re entitled to a tax refund, you could receive it as early as 10 days after you send in your electronic files. The soonest you could expect to receive a refund if you submit your tax forms by mail is six weeks after the IRS receives your forms.

    Track Your Refund

    When you file your taxes electronically, you can track the status of your refund beginning 72 hours after you submit your claim. Look online at the IRS Where’s My Refund? site (see Resources). You can check your refund if you submit a paper return, but you’ll need to wait three weeks before the information will be available.

    Pay to File

    If your adjusted gross income is $57,000 or less, you can file your taxes for free, either by completing the online fillable forms at the Free File site, or by using one of the software packages or tax preparation services that offer Free File. You can find a list of these packages and services on the Free File website. But if your adjusted gross income is more than $57,000, you may have to pay to file your taxes electronically. Some tax software includes the option to file online as part of the purchase price for the software, and some tax accountants offer electronic filing as part of their services, but you won’t be able to file for free using the free IRS software.

    Security

    When you submit your taxes electronically, you trust your financial data to the security of your Internet connection, or the network of your tax preparer. While most networks are secure, a hacker could intercept or retrieve your sensitive financial data and wreak havoc. Of course, if you mail your tax returns, a thief could steal the return, but some people feel more secure submitting their tax forms via registered mail or through a carrier that offers insurance and guaranteed delivery.

    About the Author

    Cynthia Myers is the author of numerous novels and her nonfiction work has appeared in publications ranging from "Historic Traveler" to "Texas Highways" to "Medical Practice Management." She has a degree in economics from Sam Houston State University. Before turning to freelancing full-time, Myers worked as a newspaper reporter, travel agent and medical clinic manager.

    Photo Credits

    • Creatas/Creatas/Getty Images