Dave Ramsey Advisors – What to Consider When Filing My Taxes Online

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

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

The majority of individual income tax returns submitted to the IRS are e-filed.  E-filing is a favorite because it’s a win-win for taxpayers and the IRS.

In return, you could find any refund you’re owed quicker, particularly if you have it directly deposited into your bank accounts.

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

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

  1. Quick affirmation your forms are obtained: The IRS will confirm a tax filing was received within one day of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived . 
  2. 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’ll get your money in 3 weeks or not.  Choosing direct deposit may also speed up the refund procedure.

  3. Reduced chance of errors: According to the IRS, there is around a 1% error rate on e-filed yields, 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.

  4. Simple payment procedure: If you owe the IRS money, it is easier to pay at your convenience if you e-file.  You can submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline.  And you can schedule electronic funds transfers to easily 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 option to pay your balance by making use of the IRS Immediate pay service from your checking account or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) can lead to interest and penalties.

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

The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is simple.

    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 Types — If your income is over $72,000 and you’re comfortable doing your taxes without assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer basic guidance.  You can only do your federal return with all these forms. 
    3. Use an online tax preparation tax or service applications: Tax preparation software and online filing services are alternatives.  These options are an easy way to complete and e-file your forms.  Some software suppliers charge for their apps, Some are liberated.   The program asks you simple questions about your life and finances to guide you through the completion of your types.  
    4. Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free help is typically limited based on income, and some services cater to particular demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older. 
    5. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re authorized IRS e-file providers. The IRS maintains a record of licensed providers, but be aware this alternative is very likely to be the most costly one. 

Employing online tax preparation software is far and away the preferred approach of most taxpayers.  In fact, the IRS says it expected over four tax returns to be filed through tax return prep software.

Is e-filing really stable?

While e-filing is suitable, you may worry about safety — especially with all these data breaches.  But experts agree that this isn’t a problem which should deter you from e-filing.

“E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted network as opposed to exposing your information in the email.”

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

It is important to use a trustworthy service to assist you record your taxes.  Chow advises to not e-file on a public computer or utilize an online connection which isn’t confidential.

Bottom line

For most taxpayers, it makes sense to e-file a yield because 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 be certain to use tax preparation software from a trusted source, so you may make certain the information which you supply to transmit to the IRS will be kept protected.