George Soros Warren Buffett – What to Consider When Filing My Taxes Online

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

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

The majority of 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 employees don’t need to spend time manually processing your return. And in return, you could find any refund you’re owed faster, particularly if you have it directly deposited into your bank account.

But what about safety?  And can electronic filing actually give you access to all the forms that you may need if you’ve got a intricate tax situation?  Are there ever situations when you can’t e-file?  Let’s look at the benefits of e-filing, and if it might be the best filing choice for your requirements.

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

  1. Quick affirmation your forms are received: The IRS will affirm a tax filing was received within 24 hours 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 can take six to eight months to receive a tax refund.  With e-filing, you are going to get your money in three weeks or less.  Choosing direct deposit may also accelerate the refund process.

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

  4. Simple payment process: If you owe the IRS money, it is easier to cover at your convenience when you e-file.  It’s possible to submit returns early and pay afterwards if necessary, as long as you pay by the April 15 filing deadline.  Additionally you have the choice to pay your balance by making use of 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.  Just be aware delaying payment after the filing due date (typically April 15) can lead to penalties and interest.

  5. Digital storage of tax information: Submitting returns electronically implies there’s a digital backup of your tax documents.  So if something happens to your paperwork, then you’ll have an electronic backup.

The good news: Most taxpayers do opt to e-file and find those advantages — and the process of doing this is simple.

  • Free File Fillable Types — If your income is more than $72,000 and you’re comfortable doing your taxes without any help, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer standard guidance.  You can simply do your federal return with all these forms. 
  • Use an online tax preparation service or tax software: Tax preparation software and online filing services are options.  These choices are a simple way to finish and e-file your forms.  Some software suppliers charge for their programs, Some are liberated.   The program asks you simple questions about your life and finances to steer you through the completion of your types.  
  • Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free aid is normally restricted based on earnings, and a few services appeal to specific demographic groups.  For instance, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are licensed IRS e-file providers. The IRS maintains a database of authorized providers, but you should be aware this alternative is likely to be the most costly one. 

    Using online tax preparation software is far and away the preferred approach of the majority of taxpayers.  In fact, the IRS says it anticipated more than four in five tax returns to be submitted through tax return prep program.

    Is e-filing really stable?

    While e-filing is suitable, you could worry about security — especially with all these data breaches.  But experts agree this is not a problem which should deter you from e-filing.

    “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your data in the email.”

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

    It’s important to employ a trusted service to assist you file your taxes.  Chow advises to not e-file on a computer or utilize an internet connection that isn’t confidential.

    Bottom line

    For most taxpayers, it makes sense to e-file a return because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just be certain to use tax planning software from a dependable source, so you may ensure the information you provide to transmit to the IRS is going to be kept secure.