Dave Ramsey For President – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree about 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 can find any refund you’re owed quicker, especially if you have it directly deposited to your bank accounts.

But what about safety?  And can digital filing actually provide you access to all the forms you may need if you’ve got a complex tax situation?  Are there ever situations when you can not e-file?  Let’s look at the advantages of e-filing, and if it might be the best filing choice for your needs.

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

  1. Quick affirmation your forms are obtained: The IRS will confirm a tax filing has been received within one day of electronic 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 may take six to eight weeks to receive a tax refund.  With e-filing, you’ll get your money in 3 weeks or less.  Choosing direct deposit may also accelerate the refund process.

  2. Reduced likelihood of mistakes: According to the IRS, there is around a 1% error rate on e-filed yields, compared with a 20% speed of errors on paper filings.  The IRS also provides more info on issues discovered on e-filed returns compared with paper returns.

  3. Simple payment procedure: If you owe the IRS money, it’s easier to pay at your advantage when you e-file.  You can submit returns early and pay afterwards if needed, provided that you pay by the April 15 filing deadline.  Additionally you have the option to pay your balance by making use of the IRS Immediate pay service from your checking 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 following the filing due date (typically April 15) will lead to interest and penalties.

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

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

The types do the math for you and provide basic guidance.  You can simply do your federal return with all these forms. 

  • Use an online tax preparation service or tax applications: Tax prep software and online filing services are alternatives.  These choices are a simple way to complete and e-file your own forms.  Some applications providers charge for their programs, Some are free.   The software asks you simple questions about your own life and financing to guide 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 yields.  However, eligibility for free help is typically limited based on income, and some providers appeal to specific demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.  The IRS maintains a record of authorized providers, but be aware this option is likely to be the most costly one. 

    Using online tax prep software is far and away the preferred approach of the majority of taxpayers.  Actually, the IRS says it anticipated over four tax returns to be submitted through tax return prep software.

    Is e-filing really secure?

    While e-filing is convenient, you could worry about safety — especially with all these data breaches.  But experts agree that this isn’t a problem that should deter you from e-filing.

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

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

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

    Bottom line

    For most taxpayers, it is sensible to e-file a return since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options.  Just be sure that you use tax planning software from a trusted source, so that you may make certain the information you supply to transmit to the IRS is going to be kept secure.