Dave Ramsey Recommended Percentages – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree on everything, but they are mostly on precisely the exact same page in regards to e-filing individual income tax returns.

Nearly all individual income tax returns filed to the IRS are e-filed.  E-filing is popular as it’s a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you save the IRS cash because its workers don’t have to spend time manually processing your return. In return, you can get any refund you’re owed faster, particularly in the event that you have it directly deposited into your bank accounts.

But what about security?  And can digital filing actually give you access to all the forms you may need in case you have a intricate tax situation?  Are there 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 needs.

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

  1. Quick confirmation your forms are obtained: The IRS will affirm a tax filing was received within one day 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 may take six to eight months to receive a tax refund.  With e-filing, you’ll get your money in three weeks or less.  Choosing direct deposit can also speed up the refund process.

  2. Reduced chance of mistakes: According to the IRS, there’s 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. Easy payment procedure: If you owe the IRS money, it’s easier to cover at your convenience if you e-file.  It’s possible to submit returns early and pay afterwards if necessary, provided that you pay by the April 15 filing deadline.  You also have the option to pay your balance by using 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 data: Submitting returns electronically implies there is an electronic backup of your tax records.  So if something happens to your paperwork, you will have a digital backup.

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

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

  • Free File Fillable Forms — If your income is more than $72,000 and you are comfortable doing your taxes without assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer basic advice.  You can only do your federal return with these forms. 
  • Utilize an online tax preparation service or tax software: Tax prep software and online filing services are options.  These choices are a simple way to finish and e-file your forms.  Some applications suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your own 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.  But eligibility for free help is normally restricted based on earnings, and a few services cater to particular demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are authorized IRS e-file providers. The IRS maintains a database of licensed 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 favored approach of most taxpayers.  Actually, the IRS says it expected more than four tax returns to be submitted through tax return prep program.

    Is e-filing really secure?

    While e-filing is convenient, you may be worried about security — especially with all these data breaches.  But experts agree this isn’t an issue which should dissuade you from e-filing.

    “In fact, it can be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your data in the mail.”

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

    It is important to employ a trustworthy service that will assist you record your taxes.  Chow advises not to e-file on a computer or use an online connection which isn’t private.

    Bottom line

    For many taxpayers, it makes sense to e-file a yield because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options.  Just make certain that you use tax preparation software from a dependable source, so you may ensure the information you provide to transmit to the IRS will be kept secure.