Suze Orman 2020 – Is It Best To E-File My Taxes?

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

Americans and the IRS may not agree about everything, but they are largely on precisely the exact 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. 

In return, you could get any refund you’re owed faster, especially if you have it directly deposited into your bank account.

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

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

  1. Quick confirmation 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 doesn’t send any acknowledgment that your forms have arrived . 
  2. Timely refunds: When you submit a paper filing, it can take six to eight months to be given a tax refund.  With e-filing, you’ll receive your money in 3 weeks or not.  Choosing direct deposit may also speed up the refund procedure.

  3. Reduced chance of mistakes: According to the IRS, there’s approximately 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 issues discovered on e-filed returns compared with paper yields.

  4. Easy payment process: If you owe the IRS money, it’s easier to cover at your advantage if you e-file.  It’s possible to submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline.  Additionally you have the option to pay your balance by making use of the IRS Direct pay service from your checking or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order. 

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

The good news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing so is easy.

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you may 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. Use an internet tax preparation tax or service applications: Tax prep software and online filing services are options.  These choices are an easy way to finish and e-file your forms.  Some applications suppliers charge for their programs, Some are free.   The program asks you simple questions about your life and financing to guide you through the completion of your forms.  
    3. Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on earnings, and a few services cater to particular demographic groups.  By way of instance, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older.  The IRS maintains a record of authorized providers, but you should be aware this option is likely to be the most costly one. 

      Employing online tax prep software is far and away the preferred approach of most taxpayers.  Actually, the IRS says it anticipated more than four tax returns to be filed through tax return prep program.

      Is e-filing really stable?

      While e-filing is suitable, you could worry about safety — especially with all these data breaches.  But experts agree this isn’t an issue which should dissuade you from e-filing.

      “E-filing a tax return has turned out to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private 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 put security measures in place to keep your data safe.  “Trainers normally use IRS particular APIs that require token sessions,” Chow says.  “All of this is routed over TLS encrypted connections.”

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

      Bottom line

      For most 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 easy payment choices.  Just be certain to use tax planning software from a trusted source, so you may make certain the information which you supply to transmit to the IRS is going to be kept protected.