Buffett Warren Net Worth – What to Consider When Filing My Taxes Online

Is e-filing a better way to record your taxes? 

Americans and the IRS may not agree on everything, but they’re largely on the exact same page when it comes to e-filing individual income tax returns.

The majority of individual income tax returns filed to the IRS are e-filed.  E-filing is popular as it is a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you conserve the IRS money because its employees don’t need to spend time manually processing your return. And in return, you could get any refund you’re owed quicker, particularly if you have it directly deposited into your bank accounts.

However, what about safety?  And can electronic filing really give you access to all of the forms you might need in case you’ve got a intricate tax situation?  Are there situations when you can’t e-file?  Let’s look at the advantages of e-filing, and if it might be the very best filing choice for your needs.

If you’re Considering e-filing, some of the advantages include:

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived . 

    Timely refunds: When you publish a paper filing, it can take six to eight weeks to be given a tax refund.  With e-filing, you are going to receive your money in three weeks or less.  Choosing direct deposit can also accelerate the refund procedure.

  2. Reduced chance of errors: In accordance with the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.

  3. Simple payment procedure: If you owe the IRS money, it’s simpler to pay at your convenience if you e-file.  It’s possible to submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline.  And you can schedule electronic funds transfers to send the IRS what you owe on a date of your choosing — again, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by using the IRS Immediate pay service from your checking or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order. 

  4. Digital storage of tax data: Submitting returns electronically means there is an electronic copy of your tax documents.  So if something happens to your paperwork, you’ll have a digital backup.

The good news: Most taxpayers do opt to e-file and find those advantages — and the practice of doing so is easy.

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you could be able to use the IRS Free File program. 
    2. Free File Fillable Forms — If your income is more than $72,000 and you are comfortable doing your taxes without assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide basic guidance.  You can simply do your federal return with all these kinds. 
    3. Utilize an online tax preparation service or tax applications: Tax prep software and online filing services are options.  These options are an easy way to complete and e-file your own forms.  Some applications providers charge for their programs, Some are free.   The software asks you simple questions about your own life and finances to steer you through the completion of your forms.  
    4. Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free help is typically limited based on earnings, and a few providers cater to particular demographic groups.  The IRS maintains a record of authorized providers, but you should be aware this option is likely to be the most costly one. 

Employing online tax preparation software is far and away the preferred approach of most taxpayers.  Actually, the IRS says it anticipated more than four tax returns to be submitted through tax return prep software.

Is e-filing really stable?

While e-filing is suitable, you could be worried about safety — particularly with all these data breaches.  But experts agree this isn’t an issue which should deter you by e-filing.

“In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted network rather than exposing your information in the email.”

Dennis Chow, vice president of information security at SCIS Security, explains that the IRS has set security measures in place to keep your data safe.  “Vendors typically utilize IRS particular APIs that require token sessions,” Chow says.  “All of this is routed over TLS encrypted connections.”

It is important to employ a trusted service to help you file your taxes.  Chow advises not to e-file on a computer or use an online connection which is not private.

Bottom line

For most taxpayers, it is sensible to e-file a return because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options.  Just be certain that you use tax preparation software from a dependable source, so that you can ensure the information you provide to transmit to the IRS is going to be kept secure.