Is Warren Buffett Selling His Stocks – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree about everything, but they are mostly on the exact 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 popular because it’s a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you save the IRS cash because its workers do not have to spend time manually processing your return. In return, you can get 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 provide you access to all of the forms that you may need if you’ve got a intricate tax situation?  Are there situations when you can’t e-file?  Let’s look at the advantages of e-filing, and whether it may be the best filing choice for your needs.

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

  1. Quick confirmation your forms have been obtained: The IRS will confirm a tax filing has been received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely. 

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

  2. Reduced chance of errors: According to the IRS, there is approximately a 1% error rate on e-filed yields, 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 procedure: If you owe the IRS money, it is easier to cover at your convenience if you e-file.  You can submit returns early and pay afterwards if needed, provided that 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 your checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) will lead to interest and penalties.

  4. Digital storage of tax data: Submitting returns electronically implies there is a digital backup of your tax documents.  If something happens to your paperwork, then you’ll have an electronic backup.

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

The way to e-file a tax return?

    1. Use IRS Free File: If your adjusted gross income is $72,000 or not as you could have the ability to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is more than $72,000 and you are comfortable doing your earnings without help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer basic advice.  You can only do your federal return with these forms. 
    3. Use an online tax preparation tax or service software: Tax preparation software and online filing services are options.  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 program asks you simple questions about your life and finances to guide you through the completion of your types.  
    4. Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on income, and some providers cater to specific demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older. 
    5. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re licensed IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this alternative is very likely to be the most costly one. 

      Employing online tax prep software is far and away the preferred approach of most taxpayers.  Actually, the IRS says it anticipated over four tax returns to be submitted through tax return prep software.

      Is e-filing really stable?

      While e-filing is convenient, you could worry about safety — particularly with all these data breaches.  But experts agree that this isn’t an issue that should deter you by e-filing.

      “In fact, 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 data security at SCIS Security, explains that the IRS has set security measures in place to keep your information secure.  “Trainers normally use IRS particular APIs that need ab sessions,” Chow says.  “All this is routed over TLS encrypted links “

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

      Bottom line

      For most taxpayers, it is sensible 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 effortless payment choices.  Just be sure to use tax planning software from a dependable source, so that you can make certain the information which you supply to transmit to the IRS is going to be kept secure.