Dave Ramsey 4 Mutual Funds – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree on everything, but they are mostly on precisely the exact same page when it comes to e-filing individual income tax returns.

Nearly all individual income tax returns filed to the IRS are e-filed.  E-filing is a favorite because it is a win-win for taxpayers and the IRS.

In return, you could get any refund you’re owed quicker, especially in the event that you have it directly deposited to your bank accounts.

But what about security?  And can digital filing actually give you access to all the forms you may need in case you have a intricate tax situation?  Are there ever situations when you can not e-file?  Let us look at the advantages of e-filing, and if it might be the very best filing choice for your requirements.

If you are thinking about e-filing, a Few of the advantages include:

  1. Quick confirmation your forms have been received: The IRS will affirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived . 
  2. Timely refunds: When you submit a paper filing, it can take six to eight months to receive a tax refund.  With e-filing, you’ll receive your money in three weeks or less.  Choosing direct deposit may also accelerate the refund procedure.

  3. Reduced chance of mistakes: According to the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more info on issues discovered on e-filed returns compared with paper yields.

  4. Simple payment procedure: If you owe the IRS money, it is simpler to pay at your advantage when you e-file.  You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline.  Additionally you have the option to pay your balance by making use of the IRS Direct pay service from your checking or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) will result in penalties and interest.

  5. Digital storage of taxation information: Submitting returns electronically implies there’s an electronic copy of your tax records.  If something happens to your paperwork, then you’ll have a digital backup.

The fantastic news: Most taxpayers do opt to e-file and get those benefits — and the practice of doing this is easy.

  • Free File Fillable Types — If your income is more than $72,000 and you are comfortable doing your taxes without any help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer basic guidance.  You can simply do your federal return with these forms. 
  • Use an online tax preparation service or tax applications: Tax preparation software and online filing services are options.  These options are a simple way to finish and e-file your forms.  Some applications suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your own life and financing to guide you through the completion of your forms.  
  • Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free aid is normally restricted based on income, and a few providers cater to specific demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this alternative is very likely to be the most costly one. 

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

    Is e-filing really stable?

    While e-filing is suitable, you may be worried about security — particularly with so many data breaches.  But experts agree this is not an issue which should deter you from e-filing.

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

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

    It’s very important to employ a trusted service to help you record your taxes.  Chow advises to not e-file on a computer or utilize an online connection which is not confidential.

    Bottom line

    For most taxpayers, it makes sense to e-file a yield since it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just make sure that you use tax planning software from a dependable source, so you can make certain the information you supply to transmit to the IRS will be kept secure.