Dave Ramsey Splash Financial – What to Consider When Filing My Taxes Online

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

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

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

And in return, you can find any refund you are owed faster, particularly in the event that you have it directly deposited into your bank accounts.

However, what about security?  And can digital filing actually provide you access to all the forms you may need in case you have a intricate tax situation?  Are there ever situations when you can’t e-file?  Let us look at the advantages of e-filing, and whether it may be the best filing option for your needs.

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

  1. Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived safely. 
  2. Timely refunds: When you submit a paper filing, it may take six to eight months 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.

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

  4. Simple payment process: If you owe the IRS money, it’s easier to pay at your advantage when you e-file.  It’s possible to submit returns early and pay later if needed, provided that you pay from the April 15 filing deadline.  Additionally you have the choice to pay your balance by making use of the IRS Immediate 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. 

  5. Digital storage of tax information: Submitting returns electronically means there is a digital backup of your tax documents.  If something happens to your paperwork, you will have a digital backup.

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

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

  • Free File Fillable Types — If your income is more than $72,000 and you’re comfortable doing your earnings without assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer standard advice.  You can only do your federal return with these forms. 
  • Use an internet tax preparation tax or service applications: Tax preparation software and online filing services are options.  These choices are an easy way to complete and e-file your forms.  Some software suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your life and financing to steer you through the completion of your types.  
  • Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free help is typically limited based on income, and some services appeal to specific demographic groups.  By way of instance, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older.  The IRS maintains a record of licensed providers, but you should be aware this option 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 expected 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 be worried about safety — particularly with so many data breaches.  But experts agree that this is not an issue which should dissuade you by e-filing.

    “In actuality, it may be more secure than paper filing since you’re sending your private information through an encrypted network rather than exposing your data in the email.”

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

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

    Bottom line

    For most taxpayers, it is sensible 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 make sure to use tax planning software from a dependable source, so that you can make certain the information which you provide to transmit to the IRS is going to be kept secure.