Dave Ramsey Smart Conference – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree on everything, but they’re mostly on the 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. 

In return, you can get any refund you are owed quicker, especially if you have it directly deposited into your bank accounts.

However, what about safety?  And can electronic filing really provide you access to all the forms you may need if you’ve got a intricate tax situation?  Are there situations when you can not e-file?  Let’s look at the benefits of e-filing, and if it might be the best filing option for your needs.

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

  1. Quick confirmation your forms have been received: The IRS will affirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely. 
  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 are going to receive your money in 3 weeks or not.  Choosing direct deposit may also accelerate the refund procedure.

  3. Reduced chance of mistakes: According to the IRS, there’s around a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more info on problems discovered on e-filed yields compared with paper yields.

  4. Easy payment process: If you owe the IRS money, it’s easier to cover at your convenience if you e-file.  You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline.  Additionally you have the choice to pay your balance by using the IRS Direct pay service from the checking account or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) can lead to penalties and interest.

  5. Digital storage of tax data: Submitting returns electronically implies there’s a digital backup of your tax records.  If something happens to your paperwork, you’ll have an electronic backup.

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

The way to e-file a tax return?

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

  • Use an online tax preparation service or tax software: Tax prep software and online filing services are alternatives.  These options are a simple way to finish and e-file your own forms.  Some software suppliers charge for their apps, Some are free.   The software asks you simple questions about your own life and finances to steer you through the completion of your forms.  
  • Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns.  But eligibility for free aid is normally restricted based on earnings, and a few providers cater to particular demographic groups.  The IRS maintains a database of authorized providers, but 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 anticipated more than four tax returns to be filed through tax return prep software.

    Is e-filing really stable?

    While e-filing is suitable, you could be worried about safety — particularly with so many data breaches.  But experts agree this isn’t a problem that should dissuade you from e-filing.

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

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

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

    Bottom line

    For most taxpayers, it makes sense to e-file a yield because 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 sure to use tax planning software from a dependable source, so that you can make certain the information you supply to transmit to the IRS will be kept secure.