Lunch With Warren Buffett Auction – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree on everything, but they are largely on the same page when it comes to e-filing individual income tax returns.

The majority of individual income tax returns submitted to the IRS are e-filed. 

In return, you could get any refund you’re owed faster, particularly in the event that you have it directly deposited to your bank accounts.

But what about safety?  And can electronic filing really provide you access to all the forms that you may need if you have a intricate 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 best filing option for your needs.

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

  1. Quick affirmation your forms have been received: The IRS will confirm a tax filing was received within one day of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived . 
  2. Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given a tax refund.  With e-filing, you are going to get your money in 3 weeks or less.  Choosing direct deposit can also accelerate the refund process.

  3. Reduced chance of errors: According to the IRS, there’s around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more info on issues discovered on e-filed yields compared with paper yields.

  4. Easy payment procedure: If you owe the IRS money, it’s easier to cover at your advantage if you e-file.  You can submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline.  And you’re able to schedule electronic funds transfers to easily send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by using 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. 

  5. Digital storage of taxation data: Submitting returns electronically implies there’s an electronic copy of your tax records.  So if something happens to your paperwork, then you will have a digital backup.

The good news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing so is simple.

How to e-file a tax return?

    1. Use IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program.  The types do the math for you and offer basic advice.  You can only do your federal return with all these forms. 
    2. Utilize an online tax preparation service or tax software: Tax prep software and online filing services are options.  These choices are a simple way to finish and e-file your own forms.  Some software suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your life and finances to guide you through the completion of your types.  
    3. Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free aid is typically limited based on earnings, and a few services cater to particular demographic groups. 
    4. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re 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. 

      Employing online tax preparation software is far and away the favored approach of the majority of 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 may worry about security — particularly with so many data breaches.  But experts agree that this isn’t a problem that should deter you by e-filing.

      “E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “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 that the IRS has put security measures in place to keep your data safe.  “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted links “

      It’s important to employ a trustworthy service to help you record your taxes.  Chow advises to not e-file on a computer or utilize an online connection which is not private.

      Bottom line

      For most taxpayers, it makes sense 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 easy payment choices.  Just make sure that you use tax preparation software from a trusted source, so that you may ensure the information which you supply to transmit to the IRS will be kept protected.