Richard Branson Net Worth 2020 – Should I E-file 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 mostly on precisely the same page when it comes 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.

And in return, you can get any refund you are owed quicker, particularly if you have it directly deposited to your bank accounts.

However, what about security?  And can electronic filing really give you access to all of the forms that you might need in case you have a complex tax situation?  Are there situations when you can’t e-file?  Let us look at the advantages of e-filing, and if it may be the best filing option for your requirements.

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

  1. Quick affirmation your forms have been received: The IRS will affirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived safely. 
  2. Timely refunds: When you publish a paper filing, it can take six to eight months to receive a tax refund.  With e-filing, you are going to get your money in three weeks or less.  Choosing direct deposit may also accelerate the refund process.

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

  4. Easy payment process: If you owe the IRS money, it’s easier to cover at your convenience when you e-file.  You can submit returns early and pay afterwards if necessary, provided that you pay from the April 15 filing deadline.  Additionally you have the option to pay your balance by using the IRS Immediate pay service from your checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order. 

  5. Digital storage of tax data: Submitting returns electronically implies there’s an electronic copy of your tax documents.  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 process of doing this is simple.

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

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program. 
    2. Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your earnings without any assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer standard advice.  You can simply do your federal return with these kinds. 
    3. Use an internet tax preparation tax or service software: Tax preparation software and online filing services are alternatives.  These choices are a simple way to complete and e-file your forms.  Some software suppliers charge for their apps, Some are free.   The software asks you simple questions about your life and financing to guide you through the completion of your types.  
    4. Get complimentary, in-person tax help: 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 a few services cater to particular demographic groups.  The IRS maintains a database of licensed providers, but be aware this option is very likely to be the most costly one. 

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

Is e-filing really secure?

While e-filing is suitable, you may worry about safety — especially with all these data breaches.  But experts agree that this is not an issue that should deter you from 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 leadership, advertising and revenue at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your personal information through an encrypted system rather than exposing your information in the email.”

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

It’s important to employ a trusted service that will assist you file your taxes.  Chow advises to not e-file on a computer or utilize an internet connection that isn’t confidential.

Bottom line

For most taxpayers, it makes sense to e-file a return because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just make certain to use tax planning software from a trusted source, so that you can make certain the information which you supply to transmit to the IRS is going to be kept protected.