How Warren Buffett Trades – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree about everything, but they’re mostly 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 because it’s a win-win for taxpayers and the IRS.

And in return, you can find any refund you’re owed faster, particularly in the event that you have it directly deposited into your bank account.

However, what about safety?  And can digital filing actually give you access to all the forms that you may need if you have a complex tax situation?  Are there situations when you can’t e-file?  Let’s look at the advantages of e-filing, and if it may be the very best filing option for your needs.

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 

    Timely refunds: When you publish a paper filing, it can take six to eight weeks to receive 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 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 issues discovered on e-filed returns compared with paper returns.

  3. Simple payment process: If you owe the IRS money, it is simpler to pay at your convenience if you e-file.  You can submit returns early and pay afterwards if necessary, as long as you pay by the April 15 filing deadline.  And you’re able to schedule electronic money transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by making use of the IRS Immediate pay service from the checking or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order. 

  4. Digital storage of tax data: Submitting returns electronically implies there is a digital backup of your tax records.  So if something happens to your paperwork, you’ll have a digital backup.

The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the process of doing this is easy.

How to e-file a tax return?

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you could be able to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is over $72,000 and you’re comfortable doing your taxes without any assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide standard guidance.  You can only do your federal return with these forms. 
    3. Use an internet tax preparation service or tax applications: Tax preparation software and online filing services are options.  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 own life and finances to guide you through the completion of your forms.  
    4. Get complimentary, 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 income, and some providers cater to particular demographic groups.  The IRS maintains a record of licensed providers, but be aware this option is likely to be the most costly one. 

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

Is e-filing really secure?

While e-filing is convenient, you may be worried about security — particularly with so many data breaches.  But experts agree this is not an issue which should dissuade you by e-filing.

“E-filing a tax return has proven to be a very secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted system as opposed to exposing your information in the email.”

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

It is very important to use a trustworthy service that will help you file your taxes.  Chow advises not to e-file on a computer or utilize an online connection that isn’t private.

Bottom line

For most taxpayers, it makes sense to e-file a return since it’s the most convenient way to file 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 trusted source, so that you may ensure the information you supply to transmit to the IRS is going to be kept secure.