Robert Kiyosaki Asset Protection – Should I E-file My Taxes Online

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

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

The majority of individual income tax returns submitted to the IRS are e-filed.  E-filing is a favorite as it’s a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you save the IRS cash because its employees don’t need to spend time manually processing your return. And in return, you can get any refund you’re owed quicker, particularly if you have it directly deposited into your bank account.

However, what about security?  And can digital filing actually give you access to all the forms that you may need if you have a complex tax situation?  Are there situations when you can not e-file?  Let’s look at the advantages of e-filing, and whether it may be the very best filing choice for your requirements.

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

  1. Quick affirmation your forms are received: The IRS will affirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 

    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 receive your money in 3 weeks or less.  Choosing direct deposit can also speed up the refund procedure.

  2. Reduced chance of mistakes: According to the IRS, there is approximately a 1% error rate on e-filed yields, 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.

  3. Easy payment process: If you owe the IRS money, it’s simpler to cover at your convenience if you e-file.  It’s possible to submit returns early and pay afterwards if necessary, provided that 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, as long as the IRS receives your payment by Tax Day. You also have the choice to pay your balance by making use of the IRS Direct pay service from the checking account or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. 

  4. Digital storage of tax information: Submitting returns electronically implies there’s a digital backup of your tax documents.  If something happens to your paperwork, you’ll have a digital backup.

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

The way to e-file a tax return?

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

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you may be able to use the IRS Free File program.  The forms do the math for you and provide standard guidance.  You can only do your federal return with all these forms. 
    2. Utilize an online tax preparation service or tax software: Tax preparation software and online filing services are alternatives.  These options are an easy way to finish and e-file your forms.  Some applications providers charge for their programs, Some are liberated.   The program asks you simple questions about your own life and financing to steer you through the completion of your types.  
    3. Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free aid is normally restricted based on income, and some providers cater to specific demographic groups. 
    4. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a record of authorized 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 anticipated more than four in five tax returns to be filed through tax return prep program.

Is e-filing really secure?

While e-filing is convenient, you could worry about security — particularly with all these data breaches.  But experts agree this isn’t an issue which should deter you from e-filing.

“In actuality, it can be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your data in the mail.”

Dennis Chow, vice president of data security at SCIS Security, explains the IRS has set safety measures in place to keep your data safe.  “Vendors typically utilize IRS specific APIs that require ab sessions,” Chow says.  “All of this is routed over TLS encrypted links .”

It’s very important to employ a trustworthy service to help you record your taxes.  Chow advises not to e-file on a public computer or use an internet connection which is not confidential.

Bottom line

For many 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 be certain to use tax preparation software from a trusted source, so you can ensure the information you provide to transmit to the IRS is going to be kept protected.