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

Is e-filing a 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.

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.

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

However, what about safety?  And can electronic filing really give 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’s look at the advantages of e-filing, and if it might be the best filing choice for your requirements.

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

  1. Quick confirmation your forms have been received: The IRS will confirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely. 

    Timely refunds: When you publish a paper filing, it may take six to eight months to receive a tax refund.  With e-filing, you’ll receive your money in three weeks or less.  Choosing direct deposit can also speed up the refund process.

  2. Reduced likelihood of mistakes: 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 returns compared with paper yields.

  3. Easy payment process: If you owe the IRS money, it’s simpler to pay at your convenience if you e-file.  You can submit returns early and pay later if necessary, provided that you pay from the April 15 filing deadline.  And you’re able to schedule electronic money transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by using the IRS Direct pay service from your checking account or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) will result in interest and penalties.

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

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

    1. Use 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.  The types do the math for you and offer standard advice.  You can simply do your federal return with these kinds. 
    2. Utilize an internet tax preparation tax or service applications: Tax preparation software and online filing services are alternatives.  These choices are a simple way to finish and e-file your own forms.  Some applications suppliers charge for their programs, Some are free.   The software asks you simple questions about your life and financing to steer you through the completion of your forms.  
    3. Get free, in-person tax help: In most states, you will 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. 
    4. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file yields 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 very likely to be the most costly one. 

      Using 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 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 that this isn’t an issue that should dissuade you by e-filing.

      “E-filing a tax return has turned out to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and sales at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your data in the email.”

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

      It’s very important to employ a trusted service to help you record your taxes.  Chow advises to not e-file on a computer or use an online connection that isn’t confidential.

      Bottom line

      For most taxpayers, it is sensible to e-file a return since 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 make sure to use tax planning software from a trusted source, so you can make certain the information you supply to transmit to the IRS is going to be kept secure.