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

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

Americans and the IRS may not agree about 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 popular because it is a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you save the IRS cash because its employees do not need to spend time manually processing your return. And in return, you could get any refund you’re owed faster, particularly if you have it directly deposited to your bank accounts.

But what about safety?  And can digital filing really provide you access to all of the forms that you might need in case you have a complex tax situation?  Are there ever situations when you can not e-file?  Let us look at the benefits of e-filing, and whether it may be the very best filing choice for your requirements.

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

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

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

  4. Simple payment process: If you owe the IRS money, it’s simpler to cover at your convenience if you e-file.  It’s possible to submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline.  Additionally you have the option to pay your balance by using the IRS Immediate pay service from your checking account or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order. 

  5. Digital storage of tax information: Submitting returns electronically means there’s a digital backup of your tax documents.  So if something happens to your paperwork, then you’ll have an electronic backup.

The good news: Most taxpayers do decide to e-file and find those advantages — and the process of doing so is simple.

  • Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your taxes without any assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer basic guidance.  You can only do your federal return with these kinds. 
  • Utilize an internet tax preparation tax or service software: Tax prep software and online filing services are alternatives.  These choices are a simple way to finish and e-file your forms.  Some software suppliers charge for their apps, Some are free.   The software asks you simple questions about your life and finances to guide you through the completion of your forms.  
  • Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free aid is typically limited based on income, and a few providers appeal to specific demographic groups.  The IRS maintains a record of authorized providers, but be aware this option is very likely to be the most costly one. 
  • Using online tax prep software is far and away the favored approach of the majority of taxpayers.  In fact, the IRS says it expected over four tax returns to be submitted through tax return prep program.

    Is e-filing really stable?

    While e-filing is convenient, you may worry about safety — particularly with all these data breaches.  But experts agree this isn’t an issue which should deter you from e-filing.

    “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your information in the email.”

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

    It’s important to employ a trusted service that will help you record your taxes.  Chow advises to not e-file on a computer or utilize an internet connection which isn’t confidential.

    Bottom line

    For many taxpayers, it makes sense 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 easy payment options.  Just make certain that you use tax planning software from a dependable source, so you can make certain the information which you provide to transmit to the IRS is going to be kept protected.