How Warren Buffett Built His Empire – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree about everything, but they’re mostly on 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. 

In return, you can get any refund you are owed faster, particularly if you have it directly deposited into your bank accounts.

However, what about security?  And can digital filing really give you access to all the forms that you might need in case you have a complex tax situation?  Are there situations when you can not e-file?  Let’s look at the benefits of e-filing, and if it may be the very best filing choice for your requirements.

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

  1. Quick confirmation your forms are received: The IRS will affirm a tax filing was received within one day of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived . 
  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 speed up the refund procedure.

  3. Reduced chance 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 issues discovered on e-filed yields compared with paper yields.

  4. Easy payment process: If you owe the IRS money, it is simpler to pay at your advantage if you e-file.  It’s possible to 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 accounts, submitting 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 implies there is an electronic backup of your tax records.  So if something happens to your paperwork, then you’ll have an electronic backup.

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

  • Free File Fillable Types — If your income is over $72,000 and you are comfortable doing your taxes without assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide standard guidance.  You can only do your federal return with these forms. 
  • Utilize an internet tax preparation tax or service applications: Tax prep software and online filing services are alternatives.  These options are a simple way to complete and e-file your own forms.  Some software providers charge for their apps, Some are liberated.   The program asks you simple questions about your own life and financing to steer 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 returns.  But eligibility for free help is normally restricted based on earnings, and a few services appeal to particular demographic groups. 
  • 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 record of licensed providers, but be aware this option is likely to be the most costly one. 

    Employing online tax prep software is far and away the favored approach of the majority of taxpayers.  In fact, the IRS says it expected over four in five tax returns to be filed through tax return prep software.

    Is e-filing really stable?

    While e-filing is convenient, you may be worried about safety — especially with all these data breaches.  But experts agree this is not an issue that should dissuade you by e-filing.

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

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

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

    Bottom line

    For many taxpayers, it makes sense to e-file a return because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just make sure to use tax preparation software from a dependable source, so that you may make certain the information which you provide to transmit to the IRS will be kept secure.