Dave Ramsey Car Guide – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree on everything, but they’re mostly on precisely the exact same page in regards to e-filing individual income tax returns.

The majority of individual income tax returns filed to the IRS are e-filed. 

And in return, you could get any refund you are owed faster, particularly if you have it directly deposited into your bank accounts.

But what about safety?  And can digital filing really give you access to all of the forms you might 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 may be the best filing choice for your requirements.

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

  1. Quick affirmation your forms are received: The IRS will affirm a tax filing has been received within one day of digital 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 months to be given a tax refund.  With e-filing, you are going to get your money in three weeks or less.  Choosing direct deposit can also speed up the refund procedure.

  2. Reduced likelihood of errors: In accordance with the IRS, there’s approximately a 1% error rate on e-filed yields, compared with a 20% rate of errors on paper filings.  The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.

  3. Simple payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file.  It’s possible to submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline.  You also have the choice to pay your balance by using the IRS Direct pay service from your checking account or savings account, filing 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.

  4. Digital storage of tax information: Submitting returns electronically means there’s an electronic copy of your tax records.  So if something happens to your paperwork, you will have a digital backup.

The good news: Most taxpayers do decide to e-file and find those benefits — and the process of doing this is easy.

How to e-file a tax return?

  • Free File Fillable Types — If your income is more than $72,000 and you’re comfortable doing your earnings without help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer standard guidance.  You can only do your federal return with these kinds. 
  • Use an online tax preparation tax or service applications: Tax preparation software and online filing services are options.  These options are an easy way to complete and e-file your forms.  Some applications providers charge for their apps, Some are liberated.   The program asks you simple questions about your life and financing to steer 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 help is normally restricted based on earnings, and some providers appeal to specific demographic groups.  By way of instance, 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 yields for you if they’re authorized IRS e-file providers. The IRS maintains a database of authorized providers, but you should be aware this option is likely to be the most costly one. 
  • Using 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 secure?

    While e-filing is convenient, you may be worried about security — particularly with so many data breaches.  But experts agree this is not a problem that should deter you by e-filing.

    “E-filing a tax return has proven to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product direction, marketing and sales at LegalShield. “In fact, it can be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your information in the email.”

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

    It’s very important to employ a trusted service to assist you file your taxes.  Chow advises to not e-file on a computer or utilize an internet connection that isn’t private.

    Bottom line

    For most taxpayers, it is sensible to e-file a return because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices.  Just make sure that you use tax planning software from a trusted source, so you can ensure the information you supply to transmit to the IRS will be kept secure.