Stephen Covey Time Management – Should I E-file My Taxes Online

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

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

The majority of individual income tax returns submitted to the IRS are e-filed. 

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

But what about security?  And can digital filing actually provide you access to all of the forms that you might need if you have a intricate tax situation?  Are there ever situations when you can not e-file?  Let us look at the benefits of e-filing, and whether it may be the best filing choice for your needs.

If you are thinking about e-filing, some 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 digital submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely. 
  2. Timely refunds: When you submit a paper filing, it can take six to eight weeks to be given a tax refund.  With e-filing, you’ll get your money in 3 weeks or less.  Choosing direct deposit may also speed up the refund procedure.

  3. Reduced likelihood of errors: In accordance with the IRS, there’s around a 1% error rate on e-filed yields, compared with a 20% rate of errors on paper filings.  The IRS also provides more information on problems discovered on e-filed yields compared with paper returns.

  4. Easy payment process: If you owe the IRS money, it’s easier to cover at your convenience if you e-file.  It’s possible to submit returns early and pay later if necessary, as long as 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, provided that the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by making use of the IRS Direct pay service from the checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) will lead to penalties and interest.

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

The fantastic news: Most taxpayers do decide to e-file and find those benefits — and the practice of doing this is easy.

The way to e-file a tax return?

You have four choices 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 be able to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is over $72,000 and you are comfortable doing your earnings without help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide basic guidance.  You can only do your federal return with these forms. 
    3. Use an online tax preparation service or tax applications: Tax preparation software and online filing services are options.  These choices are an easy way to finish 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 finances 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 yields.  However, eligibility for free help is typically limited based on earnings, and a few services appeal to particular demographic groups. 
    5. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this alternative is likely to be the most costly one. 

Using online tax prep software is far and away the preferred approach of the majority of taxpayers.  Actually, 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 convenient, you could be worried about safety — especially with all these data breaches.  But experts agree that this isn’t an issue which should dissuade 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 direction, advertising and sales at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your personal information through an encrypted network rather than exposing your data in the email.”

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

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

Bottom line

For many 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 certain that you use tax planning software from a dependable source, so that you may make certain the information you supply to transmit to the IRS will be kept secure.