Taxes 2024: Secure online tax filing guide
Benjamin Franklin famously said that “In this world nothing can be said to be certain, except death and taxes.” But nowadays, can we be so certain that our taxes are being filed safely?
With the rise of online filing instead of pen and paper returns, paying taxes now involves sending vast amounts of personal information via the web. And, as anyone who follows cybersecurity closely will tell you, that’s a recipe for all sorts of criminal interventions.
If you’re one of the millions of people who are concerned about whether it’s safe to do taxes online, read on. We’ll get to grips with the issues and help you understand the safest, most convenient way to give the State its due.
Why are people worried about how to do taxes online?
To start with, we need to understand why online tax filing has become a hot topic.
In an ideal world, we would just click a few links, enter some numbers, and forget about filing until next year. But this definitely isn’t an ideal world where online security is concerned.
Back in 2016, the Online Trust Alliance published an explosive report concerning online filing. According to the online watchdog, 6 out of 13 tools used in the IRS Free File program failed basic cybersecurity tests.
While popular tools like TaxSlayer made the OTA’s “Honor Roll,” plenty of IRS-approved tools failed miserably, leaving filers totally exposed to phishers and identity thieves.
They also failed when it came to fraudulent filing. In these scams, criminals use personal information about legitimate filers to make fake requests for refunds – often causing serious legal and financial headaches for citizens.
As security expert Brian Krebs notes, the IRS’ Get Transcript service has been particularly vulnerable to phishers. Lax authentication procedures have allowed millions of records to be released to malicious actors.
When you combine the risks attached to using poor-quality filing tools and the dangers posed by lax IRS security, online tax filing seems to be a lot less appealing. However, we don’t want to be too negative here. While security issues have arisen and need to be taken into account, there are secure ways to file online this April 15.
Things to think about when you do taxes online
Before we look at specific tools to use when filing online, it’s worth stressing some best practices for individuals to follow.
- Always use a VPN: Virtual Private Networks (VPNs) are a must when transmitting confidential information over the web, and are especially important when filing taxes. They encrypt your data and anonymize your identity, making it very tough for cyber-criminals to target you online. We recommend using ExpressVPN or NordVPN as these are the industry leaders.
- Be savvy about free filing software: Whenever you carry out sensitive online tasks, it pays to invest in high-quality, reputable apps. This certainly applies to online filing software. While free packages are available, their quality varies massively, and many are simply fronts for malware or phishers. Spending a few extra cents can make a big difference here.
- Try to file at home or in a secure location: Online tax filing can take a few minutes with the best apps, but this can lead to significant security issues. It might be tempting to log on in a coffee shop during your lunch hour, but this would be a mistake. Unsecured public wifi networks are very vulnerable to router hijacks and man-in-the-middle attacks, and are definitely not the place to file a tax return.
- Adopt strong password security: Don’t give cyber-criminals a sniff of your login credentials. Instead, use strong passwords that aren’t connected to your everyday life. Think about using password managers like LastPass. They can lock away all of your credentials securely and vary them regularly to stay one step ahead of the attackers.
- Keep your offline data secure: Many people leave unfinished tax returns or text files with login details on their desktop. And when their laptop falls into the wrong hands, these documents are a gold mine for criminals. Don’t be like those individuals. Delete sensitive documents when you’ve finished with them, or archive them with secure encryption. Whatever you do, don’t just leave tax documents in standard folders on your computer.
Keep those basic security measures in mind when April 15 nears, and you’ll radically reduce the risk of falling victim to cyber-fraud. But this doesn’t clear up the question: is it safe to file taxes online? We still need to assess specific apps to see whether they measure up.
Should you use efile.com to file your taxes?
In recent years, efile has become a market leader in the tax filing sector, and you may well have come across it in your online research. On the surface, it looks like an excellent option, making it easy to claim tax refunds and file under the various codes used by the IRS.
The company hosts a huge library of relevant tax forms, as well as a handy calculator to add up your deductions and work out your basic tax bill. And the actual filing system is very user-friendly.
Filers just sign up for efile, create an account, then undertake a short tax interview to establish their requirements. Before filing, users have access to a “Taxpert” to help claim various deductions, which should let them keep more of their earnings than ever before.
All of that sounds great, right? On the face of it, efile takes a lot of stress out of the filing process. But is efile safe?
Be careful about choosing efile.com as your tax assistant
To cut things short, the answer to the question is efile.com safe is: probably. But it’s not necessarily the only answer to your tax filing needs.
Firstly, efile.com uses SSL encryption for all transactions, which is reassuring. And, while it collects a lot of data about individuals – this isn’t really avoidable. The Privacy Statement does a good job of allaying concerns about data sharing, and seems to provide a solid grounding for confidentiality.
However, the free version of efile is very different to the Deluxe version. Free users receive regular advertising emails and excludes State taxes – which makes it much less powerful.
The absence of a customer service phone line is another mark against efile. While you can engage their representatives via Live Chat, that’s not the same as speaking directly. This regularly crops up in customer reviews, so be aware that if you run into problems, efile might not have your back.
Overall though, if you’re worried ifs efile is safe to use, that’s not really the major issue. If you stick to the security practices outlined earlier, the answer to your question is: yes, but be aware of its limitations.
Is it safe to file taxes online? The verdict
Efile is far from alone in the online filing world. From TurboTax and TaxSlayer, to TaxAct and H&R Block, there are plenty of options. All of them offer free versions and more feature-rich paid-for packages, and they tend to be fairly secure.
Since the scandal in 2016, filing software has sharpened up its act. So when you do taxes online, software isn’t usually the major weak point. Instead, it’s vital to use a VPN, strengthen your password security, adopt strong encryption, and secure your confidential documents.
If you do those things, you’ll be in a great position to take advantage of convenient filing software this April.
