Suze Orman Student Loan Default – Is It Best To E-File My Taxes?

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

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

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

In return, you can get any refund you are owed faster, particularly if you have it directly deposited to your bank account.

However, what about security?  And can digital filing really give you access to all of the forms that you may need if you have a complex tax situation?  Are there ever situations when you can’t e-file?  Let us look at the advantages of e-filing, and whether it may be the best filing option for your needs.

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

  1. Quick confirmation your forms have been obtained: The IRS will confirm a tax filing was received within one day of digital submission.  For paper filers, the IRS doesn’t 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 receive a tax refund.  With e-filing, you are going to get your money in 3 weeks or less.  Choosing direct deposit may also accelerate the refund procedure.

  3. Reduced likelihood of errors: According to the IRS, there is approximately a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more information on issues discovered on e-filed yields compared with paper returns.

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

  5. Digital storage of tax information: Submitting returns electronically implies there is an electronic backup of your tax documents.  So if something happens to your paperwork, you’ll have a digital backup.

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

How to e-file a tax return?

    1. Use 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.  The types do the math for you and provide basic advice.  You can only do your federal return with these forms. 
    2. Utilize an online tax preparation tax or service software: Tax prep software and online filing services are options.  These options are an easy way to complete and e-file your forms.  Some applications suppliers charge for their programs, Some are liberated.   The software asks you simple questions about your own life and financing to steer you through the completion of your forms.  
    3. Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields.  But eligibility for free aid is normally restricted based on income, and some services cater to particular demographic groups.  The IRS maintains a record of authorized providers, but be aware this option is likely to be the most costly one. 

      Using online tax prep software is far and away the favored approach of most taxpayers.  In fact, the IRS says it anticipated over 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 safety — particularly with all these data breaches.  But experts agree this isn’t an issue which should deter you from e-filing.

      “E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and revenue at LegalShield. “In actuality, it may 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 information security at SCIS Security, clarifies the IRS has set safety measures in place to keep your data safe.  “Vendors typically utilize IRS particular APIs that need ab sessions,” Chow says.  “All of this can be routed over TLS encrypted links “

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

      Bottom line

      For most taxpayers, it makes sense to e-file a return since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices.  Just be certain that you use tax preparation software from a trusted source, so you can ensure the information which you supply to transmit to the IRS will be kept secure.