David Ramsey Actor – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree about everything, but they are mostly on precisely 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.  E-filing is popular because it is a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you conserve the IRS cash because its workers don’t need to spend time manually processing your return. In return, you could find any refund you’re owed quicker, especially if you have it directly deposited to your bank accounts.

But what about security?  And can electronic filing really provide you access to all of the forms that you might need in case 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 whether it might be the best filing option for your requirements.

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

  1. Quick affirmation your forms have been obtained: 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 your forms have arrived safely. 

    Timely refunds: When you submit a paper filing, it can take six to eight weeks to be given a tax refund.  With e-filing, you are going to receive your money in three weeks or less.  Choosing direct deposit can also accelerate the refund process.

  2. Reduced likelihood of errors: In accordance with the IRS, there is around a 1 percent error rate on e-filed returns, compared with a 20% rate of errors on paper filings.  The IRS also provides more info on problems discovered on e-filed yields compared with paper returns.

  3. Simple payment procedure: If you owe the IRS money, it is simpler to pay at your convenience if 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.  You also have the option to pay your balance by making use of the IRS Direct pay service from your checking account or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order. 

  4. Digital storage of taxation information: Submitting returns electronically implies there’s a digital backup of your tax documents.  So if something happens to your paperwork, then 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 so is simple.

The way to e-file a tax return?

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

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

  • Utilize an online tax preparation tax or service applications: Tax prep software and online filing services are alternatives.  These choices are a simple way to finish and e-file your own forms.  Some applications suppliers charge for their apps, Some are free.   The program asks you simple questions about your life and financing to guide you through the completion of your types.  
  • Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free aid is typically limited based on earnings, and a few services appeal to particular demographic groups. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a database of authorized providers, but be aware this alternative is very likely to be the most costly one. 
  • Using online tax preparation software is far and away the favored approach of the majority of taxpayers.  Actually, the IRS says it expected more than four in five tax returns to be filed through tax return prep program.

    Is e-filing really secure?

    While e-filing is convenient, you could worry about safety — especially with so many data breaches.  But experts agree that this is not an issue that should dissuade you from e-filing.

    “In fact, it may 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 data secure.  “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says.  “All of this can be routed over TLS encrypted connections.”

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

    Bottom line

    For most taxpayers, it makes sense to e-file a yield since it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment options.  Just be certain to use tax preparation software from a dependable source, so that you can ensure the information which you supply to transmit to the IRS is going to be kept secure.