How Did Warren Buffett Made His First Million – 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 on everything, but they’re largely on 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.  E-filing is a favorite 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 do not need to spend time manually processing your return. In return, you could find any refund you are owed faster, particularly if you have it directly deposited to your bank accounts.

However, what about security?  And can electronic filing really give you access to all of the forms you might need in case you’ve got a intricate tax situation?  Are there situations when you can’t e-file?  Let’s look at the benefits of e-filing, and whether it might be the very best filing option for your requirements.

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

  1. Quick affirmation your forms have been obtained: The IRS will confirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely. 

    Timely refunds: When you publish a paper filing, it can take six to eight weeks to receive a tax refund.  With e-filing, you’ll get your money in 3 weeks or not.  Choosing direct deposit may also speed up the refund process.

  2. Reduced likelihood of errors: According to the IRS, there is approximately a 1 percent error rate on e-filed yields, 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.

  3. Easy payment procedure: If you owe the IRS money, it’s easier to cover at your convenience if you e-file.  It’s possible to submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline.  You also have the option to pay your balance by making use of the IRS Immediate pay service from the checking account 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) will lead to interest and penalties.

  4. Digital storage of taxation data: Submitting returns electronically means there is a digital copy of your tax documents.  So if something happens to your paperwork, then you will 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.

  • 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 basic guidance.  You can simply 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 providers 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 free, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free aid is normally restricted based on earnings, and some providers cater to specific demographic groups.  By way of instance, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.  The IRS maintains a database of authorized providers, but be aware this option is very likely to be the most costly one. 

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

    Is e-filing really stable?

    While e-filing is convenient, you could worry about safety — especially with all these data breaches.  But experts agree this isn’t a problem which should deter you from e-filing.

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

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

    It is important to use a trusted service to help you file your taxes.  Chow advises to not e-file on a public computer or use an internet connection that isn’t confidential.

    Bottom line

    For most taxpayers, it is sensible to e-file a return since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices.  Just be certain to use tax planning software from a dependable source, so that you may ensure the information you supply to transmit to the IRS is going to be kept protected.