Stephen Covey 7 Habits Summary – 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’re mostly on precisely the same page in regards to e-filing individual income tax returns.

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

If you e-file your federal income tax return, you save the IRS cash because its workers don’t need to spend time manually processing your return. And in return, you could find any refund you are owed faster, particularly in the event that you have it directly deposited into your bank account.

But what about safety?  And can electronic filing actually provide you access to all the forms that you might need in case you’ve got a intricate tax situation?  Are there ever situations when you can not e-file?  Let us look at the benefits of e-filing, and if it might be the very best filing option for your requirements.

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

  1. Quick affirmation your forms are 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 . 

    Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund.  With e-filing, you are going to get your money in three weeks or not.  Choosing direct deposit may also speed up the refund process.

  2. Reduced chance of errors: According to the IRS, there is approximately a 1% 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.

  3. Simple payment process: If you owe the IRS money, it’s simpler to pay at your convenience if you e-file.  It’s possible to submit returns early and pay afterwards if needed, provided that you pay by the April 15 filing deadline.  You also have the choice to pay your balance by using the IRS Direct pay service from your checking account or savings account, filing 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) will result in penalties and interest.

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

The fantastic news: Most taxpayers do opt to e-file and find those advantages — and the process of doing so is simple.

How to e-file a tax return?

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 not as you could have the ability to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is more than $72,000 and you’re 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 provide basic advice.  You can only do your federal return with all these kinds. 
    3. Use an online tax preparation tax or service applications: Tax preparation software and online filing services are alternatives.  These choices are an easy way to complete and e-file your forms.  Some software suppliers charge for their programs, Some are liberated.   The software asks you simple questions about your life and financing to guide you through the completion of your forms.  
    4. Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free aid is normally restricted based on earnings, and some providers cater to specific demographic groups. 
    5. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re licensed IRS e-file providers. The IRS maintains a record of authorized providers, but you should be aware this alternative is very likely to be the most costly one. 

Employing online tax preparation software is far and away the favored approach of the majority of taxpayers.  Actually, the IRS says it expected 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 — particularly with so many data breaches.  But experts agree this is not an issue which should dissuade you by e-filing.

“In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to 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 data secure.  “Trainers normally use IRS specific APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted links .”

It is very important to employ a trustworthy service that will help you file your taxes.  Chow advises not to e-file on a public computer or utilize an internet connection that is not confidential.

Bottom line

For most taxpayers, it makes sense 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 options.  Just be sure that you use tax preparation software from a dependable source, so you can make certain the information which you provide to transmit to the IRS will be kept secure.