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

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

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

Nearly all 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.

If you e-file your federal income tax return, you save the IRS money because its workers do not have to spend time manually processing your return. In return, you can find any refund you are owed faster, particularly if you have it directly deposited to your bank accounts.

But what about safety?  And can electronic filing really provide you access to all of the forms you may need in case you have a intricate tax situation?  Are there situations when you can not e-file?  Let’s look at the advantages of e-filing, and if it may be the very best filing option for your requirements.

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

  1. Quick affirmation your forms are received: The IRS will affirm a tax filing was received within one day of digital submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 
  2. Timely refunds: When you publish a paper filing, it can take six to eight months to be given a tax refund.  With e-filing, you are going to get your money in 3 weeks or less.  Choosing direct deposit can also speed up the refund process.

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

  4. Easy payment procedure: If you owe the IRS money, it’s easier to cover at your convenience when you e-file.  It’s possible to submit returns early and pay afterwards if needed, as long as you pay from the April 15 filing deadline.  And you’re able to schedule electronic money 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 choice to pay your balance by making use of the IRS Immediate pay service from your checking or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) can result in interest and penalties.

  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, you’ll have an electronic backup.

The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the process of doing so is simple.

The types do the math for you and offer standard advice.  You can only do your federal return with these kinds. 

  • Use an online tax preparation service or tax software: Tax preparation software and online filing services are options.  These choices are an easy way to complete and e-file your forms.  Some software suppliers charge for their programs, Some are liberated.   The software asks you simple questions about your own life and finances to steer you through the completion of your types.  
  • Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on income, and some providers appeal to particular demographic groups.  The IRS maintains a record of authorized providers, but be aware this option is likely to be the most costly one. 
  • Employing online tax prep software is far and away the favored approach of the majority of taxpayers.  Actually, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep program.

    Is e-filing really secure?

    While e-filing is convenient, you could worry about safety — particularly with all these data breaches.  But experts agree this is not an issue that should dissuade you from e-filing.

    “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the email.”

    Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has set safety measures in place to keep your data safe.  “Trainers normally use IRS specific APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted links “

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

    Bottom line

    For most taxpayers, it makes sense to e-file a yield since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options.  Just make sure to use tax planning software from a trusted source, so you may make certain the information which you provide to transmit to the IRS will be kept protected.