Dave Ramsey Every Dollar App – What to Consider When Filing My Taxes Online

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

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

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

In return, you can get any refund you’re owed quicker, especially in the event that you have it directly deposited into your bank account.

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

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

  1. Quick confirmation your forms have been received: The IRS will affirm a tax filing has been received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived . 

    Timely refunds: When you publish a paper filing, it can take six to eight months to receive a tax refund.  With e-filing, you are going to receive your money in 3 weeks or less.  Choosing direct deposit can also speed up the refund procedure.

  2. Reduced chance of mistakes: According to the IRS, there is approximately 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 issues discovered on e-filed yields compared with paper returns.

  3. Simple payment process: If you owe the IRS money, it is simpler to pay at your advantage if 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.  And you can schedule electronic funds transfers to 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 Direct pay service from the checking or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order. 

  4. Digital storage of taxation information: Submitting returns electronically means there is a digital backup of your tax documents.  If something happens to your paperwork, you’ll have a digital backup.

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

The forms do the math for you and offer standard guidance.  You can only do your federal return with all these forms. 

  • Use an online tax preparation tax or service software: Tax preparation software and online filing services are options.  These options are an easy way to finish and e-file your own forms.  Some applications providers charge for their apps, Some are free.   The program asks you simple questions about your life and financing to guide you through the completion of your types.  
  • Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on earnings, and a few providers appeal to specific demographic groups.  For instance, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are licensed IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this alternative is very likely to be the most costly one. 
  • Using online tax preparation software is far and away the preferred approach of the majority of taxpayers.  In fact, the IRS says it anticipated over four in five tax returns to be filed through tax return prep program.

    Is e-filing really secure?

    While e-filing is suitable, you may be worried about security — particularly with so many data breaches.  But experts agree this isn’t an issue which should dissuade you by e-filing.

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

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

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

    Bottom line

    For most taxpayers, it is sensible 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 effortless payment choices.  Just make certain to use tax planning software from a trusted source, so that you can make certain the information which you supply to transmit to the IRS is going to be kept secure.