Richard Branson Knighted – Should I E-file My Taxes Online

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

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

Nearly all individual income tax returns filed to the IRS are e-filed. 

If you e-file your federal income tax return, you save the IRS money because its workers don’t need to spend time manually processing your return. In return, you can get any refund you are owed quicker, particularly if you have it directly deposited to your bank accounts.

But what about security?  And can digital filing really give you access to all of the forms that you may need if you’ve got a intricate tax situation?  Are there ever situations when you can not e-file?  Let’s look at the benefits of e-filing, and whether it may be the very best filing option for your requirements.

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

  1. Quick confirmation your forms have been obtained: The IRS will affirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely. 
  2. Timely refunds: When you publish a paper filing, it may take six to eight weeks to receive a tax refund.  With e-filing, you’ll get your money in 3 weeks or not.  Choosing direct deposit can also speed up the refund procedure.

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

  4. Easy payment procedure: If you owe the IRS money, it is simpler to cover at your advantage when you e-file.  It’s possible to submit returns early and pay later if needed, provided that 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, as long as the IRS receives your payment by Tax Day. You also have the option to pay your balance by using the IRS Immediate pay service from the checking or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) can result in interest and penalties.

  5. Digital storage of tax information: Submitting returns electronically means there’s an electronic backup of your tax documents.  If something happens to your paperwork, then you will have a digital backup.

The good news: Most taxpayers do opt to e-file and get those advantages — and the practice 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 less you could be able to use the IRS Free File program.  The types do the math for you and provide basic guidance.  You can simply do your federal return with these forms. 
    2. Utilize an internet tax preparation tax or service applications: Tax preparation software and online filing services are options.  These options are a simple way to complete and e-file your forms.  Some software providers charge for their programs, Some are free.   The software asks you simple questions about your own life and financing to steer you through the completion of your forms.  
    3. Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields.  But eligibility for free aid is normally restricted based on income, and a few services appeal to specific demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older. 
    4. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a database of authorized providers, but you should be aware this option is very likely to be the most costly one. 

      Using online tax prep software is far and away the preferred approach of most taxpayers.  In fact, the IRS says it anticipated more than four in five tax returns to be submitted through tax return prep software.

      Is e-filing really stable?

      While e-filing is suitable, you could worry about security — especially with all these data breaches.  But experts agree that this isn’t a problem which should dissuade you by e-filing.

      “E-filing a tax return has turned out to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your information in the mail.”

      Dennis Chow, vice president of data security at SCIS Security, clarifies the IRS has set security 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 is very important to employ a trusted service to help you file your taxes.  Chow advises not to e-file on a computer or utilize an internet connection which isn’t private.

      Bottom line

      For many 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 effortless payment choices.  Just be certain to use tax planning software from a trusted source, so that you may ensure the information which you supply to transmit to the IRS is going to be kept secure.