Dave Ramsey Extra Payment Calculator – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree on everything, but they are mostly 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. 

If you e-file your federal income tax return, you conserve the IRS money because its workers do not need to spend time manually processing your return. And in return, you can get 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 that you may need if you have a complex 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 option for your needs.

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing has been 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 may 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 accelerate the refund procedure.

  3. Reduced likelihood of mistakes: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% rate of errors on paper filings.  The IRS also provides more info on issues 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 advantage when you e-file.  It’s possible to submit returns early and pay later if needed, as long as you pay by the April 15 filing deadline.  And you can 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 option to pay your balance by using the IRS Immediate pay service from your checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. 

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

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

You have four choices for submitting an electronically filed tax return to the IRS.

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may be able to use the IRS Free File program.  The forms do the math for you and offer standard advice.  You can only do your federal return with these forms. 
    2. Utilize an internet tax preparation service or tax software: Tax preparation software and online filing services are alternatives.  These choices are an easy way to finish and e-file your forms.  Some software providers charge for their programs, Some are free.   The program asks you simple questions about your life and finances to steer you through the completion of your types.  
    3. Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free aid is typically limited based on income, and a few services 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.  The IRS maintains a database of authorized providers, but you should be aware this alternative is 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 anticipated more than four in five tax returns to be filed through tax return prep program.

Is e-filing really stable?

While e-filing is convenient, you could worry about security — particularly with all these data breaches.  But experts agree that this is not an issue which 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 may 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 the IRS has set safety measures in place to keep your data secure.  “Trainers normally use IRS specific APIs that need token sessions,” Chow says.  “All this is routed over TLS encrypted links .”

It is very important to use a trustworthy service that will assist you record your taxes.  Chow advises not to e-file on a computer or utilize an internet connection that is not confidential.

Bottom line

For most taxpayers, it is sensible to e-file a yield since 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 be certain that you use tax preparation software from a trusted source, so that you can make certain the information you supply to transmit to the IRS will be kept secure.