Dave Ramsey Opinion On Reverse Mortgage – Is It Best To E-File My Taxes?

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

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

Nearly all individual income tax returns submitted to the IRS are e-filed. 

In return, you could find any refund you are owed faster, especially if you have it directly deposited into your bank account.

But what about security?  And can electronic filing really give you access to all of the forms you may need if you have a complex tax situation?  Are there ever situations when you can not e-file?  Let’s look at the advantages of e-filing, and whether it might be the very best filing choice for your requirements.

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

  1. Quick affirmation your forms are obtained: The IRS will affirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely. 

    Timely refunds: When you publish a paper filing, it may take six to eight months to be given a tax refund.  With e-filing, you are going to receive your money in 3 weeks or not.  Choosing direct deposit can also speed up the refund procedure.

  2. Reduced chance of errors: In accordance with the IRS, there’s approximately a 1 percent 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 yields.

  3. Simple payment procedure: If you owe the IRS money, it’s easier to pay at your convenience when you e-file.  You can submit returns early and pay afterwards if needed, as long as you pay by the April 15 filing deadline.  Additionally you have the option to pay your balance by using the IRS Direct pay service from the checking or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) can lead to interest and penalties.

  4. Digital storage of taxation data: Submitting returns electronically means there’s a digital copy 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 get those advantages — and the practice of doing this is easy.

How to e-file a tax return?

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

  • Free File Fillable Forms — If your income is over $72,000 and you’re comfortable doing your earnings without assistance, 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 forms. 
  • Utilize an internet tax preparation service or tax software: Tax preparation software and online filing services are alternatives.  These choices are a simple way to complete and e-file your own forms.  Some software suppliers charge for their apps, Some are free.   The program asks you simple questions about your own life and finances to guide you through the completion of your types.  
  • Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free help is typically limited based on income, and a few services cater to specific demographic groups.  For instance, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older.  The IRS maintains a database of licensed providers, but you should be aware this alternative is likely to be the most costly one. 

    Using online tax prep software is far and away the favored approach of most taxpayers.  In fact, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep program.

    Is e-filing really stable?

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

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

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

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

    Bottom line

    For many taxpayers, it makes sense to e-file a return since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options.  Just be certain to use tax planning software from a dependable source, so you may ensure the information you provide to transmit to the IRS will be kept protected.