It may surprise you that you may still file a paper tax return in this digital age. Only about 10% of people were still using paper filing in 2018. What are the issues to consider when you are busy with your tax preparation and faced with paper filing versus electronic filing?
The Advantages of Electronic Filing
Filing Speed
To process electronic returns takes one or two days, but mailing paper returns takes significantly longer. Individuals and businesses benefit from faster reimbursem*nts and the IRS quickly confirm receipt of an e-filed tax return.
Accuracy
Online e-Filing handles the math for you, reducing human error. Most computer applications will detect data entering problems before you submit your e-Filing and errors on electronic returns are also easy to fix.
Disadvantages of Electronic Filing
The following are the disadvantages of the e-Filing system to consider when busy with tax preparation:
- You file before or after e-Filing (January 28) (October 20)
- You need to attach statements.
- You file decedent returns
- Your form’s “additional information” section is too small
- Data loss is a possibility
The Advantages of Paper Filing
Paper filing still has advantages:
Better Security
You can avoid submitting personal data online by filing on paper. When filing electronically, your name, address, and Social Security number are at risk. Paper filing avoids keeping tax data online. It may also assist keep information out of the wrong hands.
Ease
A paper filing does not require the use of technology. Some prefer hand-filling forms to typing data into a computer. Paper filing may be preferable if you prefer pen and paper or are not tech-savvy.
The Disadvantages of Paper Filing
The following can be disadvantageous to people who do paper filing:
Longer Time Needed for Processing
Paper filing takes longer to process since it requires postage. Unlike e-filing, which takes a few days, paper filing might take weeks. Also, refunds can take up to six weeks to arrive after filing taxes.
Less Preparation Time
Time spent preparing and mailing your tax return should be included in your decision. Waiting too long may result in late penalties.
e-Filing and paper filing have their advantages and disadvantages. When you are busy with tax preparation consider the ease, speed, and security involved before deciding. Contact your nearest tax professional for further queries.
