Richard Branson Book Screw It Let’s Do It – Should I E-file 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’re mostly on precisely 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 a favorite because it is a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you conserve the IRS money because its employees don’t have to spend time manually processing your return. And in return, you can get any refund you’re owed quicker, particularly in the event that you have it directly deposited into your bank accounts.

However, what about safety?  And can electronic filing actually give you access to all the forms that you might need in case 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 may be the very best filing choice for your requirements.

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

  1. Quick affirmation your forms are obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment that 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 are going to receive your money in 3 weeks or less.  Choosing direct deposit can also accelerate the refund procedure.

  2. Reduced chance of mistakes: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed returns, compared with a 20% speed of errors on paper filings.  The IRS also provides more information on issues discovered on e-filed returns compared with paper yields.

  3. Simple payment process: If you owe the IRS money, it’s simpler to pay at your advantage if you e-file.  It’s possible to submit returns early and pay afterwards if needed, as long as you pay from the April 15 filing deadline.  And you can schedule electronic money transfers to 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 Direct pay service from the checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order. 

  4. Digital storage of taxation data: Submitting returns electronically means there’s an electronic backup of your tax records.  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 benefits — and the practice of doing so is simple.

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

    1. Use IRS Free File: If your adjusted gross income is $72,000 or less you may be able to use the IRS Free File program.  The forms do the math for you and offer standard guidance.  You can only do your federal return with these kinds. 
    2. Use an online tax preparation tax or service applications: Tax prep software and online filing services are options.  These choices are an easy way to finish and e-file your own forms.  Some software suppliers charge for their apps, Some are free.   The program asks you simple questions about your own life and finances to steer you through the completion of your forms.  
    3. Get complimentary, in-person tax help: In most states, you can 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. 
    4. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they are licensed IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this option is likely to be the most costly one. 

      Using online tax preparation software is far and away the preferred approach of most 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 suitable, you may worry about security — particularly with so many data breaches.  But experts agree this is not an issue that should dissuade you by e-filing.

      “E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, marketing and revenue at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your data in the mail.”

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

      It is very important to employ a trustworthy service that will assist you file your taxes.  Chow advises not to e-file on a public computer or use an online connection which isn’t confidential.

      Bottom line

      For many taxpayers, it is sensible to e-file a yield because it is the most convenient way to file 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 trusted source, so you can make certain the information you provide to transmit to the IRS will be kept protected.