David Ramsey Course – Is It Best To E-File My Taxes?

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

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

The majority of individual income tax returns submitted to the IRS are e-filed. 

In return, you could get any refund you are owed faster, especially in the event that you have it directly deposited to your bank account.

But what about security?  And can digital filing really 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 benefits of e-filing, and whether it might be the best filing option for your requirements.

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

  1. Quick confirmation your forms are received: The IRS will confirm 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 be given a tax refund.  With e-filing, you are going to receive your money in three weeks or not.  Choosing direct deposit can also accelerate the refund procedure.

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

  4. Simple payment procedure: If you owe the IRS money, it’s easier to pay at your advantage when you e-file.  You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline.  You also have the choice to pay your balance by using the IRS Direct pay service from your checking account or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order. 

  5. Digital storage of taxation data: Submitting returns electronically means there’s an electronic copy of your tax records.  So if something happens to your paperwork, then you will have an electronic backup.

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

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

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

  • Use an internet tax preparation tax or service applications: Tax prep software and online filing services are alternatives.  These options are an easy way to finish and e-file your own forms.  Some software suppliers charge for their programs, Some are liberated.   The program asks you simple questions about your life and financing to guide you through the completion of your forms.  
  • Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on income, and a few providers appeal to specific demographic groups.  The IRS maintains a record 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.  In fact, the IRS says it anticipated over four tax returns to be submitted through tax return prep program.

    Is e-filing really secure?

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

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

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

    It’s important to employ a trustworthy service to assist you file your taxes.  Chow advises not to e-file on a computer or utilize an online connection that is not confidential.

    Bottom line

    For many taxpayers, it is sensible to e-file a yield since 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 to use tax preparation software from a trusted source, so that you may ensure the information which you provide to transmit to the IRS is going to be kept protected.