Rachel Cruze Dave Ramsey – What to Consider When Filing My Taxes Online

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

Americans and the IRS may 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 filed to the IRS are e-filed.  E-filing is popular as it’s a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you conserve the IRS cash because its employees do not need to spend time manually processing your return. And in return, you could get any refund you’re owed faster, especially if you have it directly deposited into your bank accounts.

However, what about safety?  And can electronic filing really give you access to all of the forms you may need if you’ve got a complex tax situation?  Are there situations when you can’t e-file?  Let us look at the benefits of e-filing, and whether it might be the very best filing choice for your needs.

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

  1. Quick affirmation your forms have been obtained: The IRS will affirm a tax filing has been received within 24 hours of digital submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 
  2. 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 may also accelerate the refund process.

  3. Reduced chance of mistakes: In accordance with the IRS, there’s 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 information on problems discovered on e-filed returns compared with paper returns.

  4. Easy payment procedure: If you owe the IRS money, it is simpler to cover at your advantage if you e-file.  You can submit returns early and pay afterwards if needed, as long as you pay from the April 15 filing deadline.  And you can 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 option to pay your balance by using the IRS Immediate pay service from the checking or savings account, filing a credit card through a payment processor for a fee, or paying by check or money order. 

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

The good news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing this is simple.

You have four options for filing an electronically filed tax return to the IRS.

The types do the math for you and provide standard advice.  You can simply do your federal return with these kinds. 

  • Use an online tax preparation service or tax software: Tax preparation software and online filing services are options.  These options are an easy way to finish and e-file your forms.  Some applications providers charge for their apps, Some are free.   The software asks you simple questions about your life and financing 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.  But eligibility for free help is normally restricted based on earnings, and a few services cater to particular demographic groups.  The IRS maintains a record of authorized providers, but be aware this alternative is very likely to be the most costly one. 
  • Using online tax preparation software is far and away the favored approach of most taxpayers.  Actually, the IRS says it expected more than four in five tax returns to be filed through tax return prep program.

    Is e-filing really stable?

    While e-filing is suitable, you may be worried about safety — especially with all these data breaches.  But experts agree that this isn’t a problem that should dissuade you from e-filing.

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

    Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has set safety measures in place to keep your data secure.  “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says.  “All this is routed over TLS encrypted connections.”

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

    Bottom line

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