e-file

Why e-file and choose direct deposit?

You can e-file (electronically file) your federal and state tax returns. Most tax preparers must e-file their clients’ tax returns. E-filing is not only fast, but it is also safe, convenient, and virtually error-free.

By combining e-file and direct deposit, you neither need to worry about your check getting lost in the mail, nor you need to go to your bank to deposit it.

Tax return errors delay refunds and to avoid them is to e-file.

Electronic filing (e-file) with Direct Deposit is the fastest way to get your federal and state refund; the refund goes directly into your bank account (either checking or savings account).

If you like, you can split your refund into up to three financial accounts including a bank or Individual Retirement Account (IRA). You can also use all or part of your tax refund to purchase up to $5,000 in U.S. Series I Savings Bonds. You need to use Form 8888, Allocation of Refund Including Savings Bond Purchases. Remember, you can only purchase up to $10,000 worth of I bonds annually online and an additional $5,000 worth of paper I bonds with your tax refund.

Series I savings bonds, called “I Bonds,” come from the U.S. Treasury and are a safe investment. I Bonds are inflation-protected because their interest rate is adjusted to inflation every 6 months. The interest income from I Bonds is tax-deferred until you cash them out. What’s more, no state income tax and only federal income tax is owed.

You can deposit your refund into accounts in your own name, your spouse’s name or both. Some banks require both spouses’ names on the account to deposit a tax refund from a joint return.

You can still use direct deposit even if you file a paper tax return. Make sure that you enter the correct bank account and routing number.

In case you owe the IRS, you can authorize the IRS to electronically withdraw the money directly from your bank account.

You can check the status of your refund on the IRS website. You will need to have the primary SSN on the return, filing status, and exact refund amount.

The IRS accepts e-file of individual and business tax returns through their IRS Authorized e-file Providers.

For more information about IRS e-file, you can visit IRS website or consult a licensed tax professional. SRJ Consulting is an IRS authorized e-file provider and a licensed tax professional.

2 thoughts on “Why e-file and choose direct deposit?”

  1. Nice article. May I please add that you can route your direct deposit to a brokerage account as well. Also you can use your refund to invest directly in us savings bonds (up to $5000).

    Thanks again!

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