Suze Orman Will – 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 about everything, but they are mostly on precisely the same page when it comes to e-filing individual income tax returns.

Nearly all individual income tax returns filed to the IRS are e-filed.  E-filing is popular because it is a win-win for taxpayers and the IRS.

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

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

If you are Considering e-filing, a Few of the advantages include:

  1. Quick confirmation your forms are received: The IRS will affirm a tax filing was received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely. 

    Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund.  With e-filing, you’ll get your money in 3 weeks or not.  Choosing direct deposit can also accelerate the refund process.

  2. Reduced likelihood of mistakes: According to the IRS, there’s around a 1% error rate on e-filed yields, 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 yields.

  3. Easy payment procedure: If you owe the IRS money, it is easier to cover at your convenience if you e-file.  You can submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline.  Additionally you have the option to pay your balance by using the IRS Direct pay service from your checking or savings account, 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) can lead to penalties and interest.

  4. Digital storage of tax information: Submitting returns electronically means there is a digital copy of your tax records.  So if something happens to your paperwork, then you will have a digital backup.

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

How to e-file a tax return?

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could have the ability to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is over $72,000 and you’re comfortable doing your earnings without assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer basic guidance.  You can simply do your federal return with all these kinds. 
    3. Utilize an online tax preparation service or tax software: Tax prep software and online filing services are options.  These options are a simple way to finish and e-file your own forms.  Some applications providers charge for their apps, Some are free.   The program asks you simple questions about your life and financing to steer you through the completion of your types.  
    4. Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  But eligibility for free aid is typically limited based on earnings, and some services appeal to specific demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.  The IRS maintains a record of licensed providers, but you should be aware this option is likely to be the most costly one. 

      Using 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 — particularly with so many 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 an extremely secure way to file your taxes,” states Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your private information through an encrypted network rather than exposing your data in the email.”

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

      It is important to employ a trusted service that will help you file your taxes.  Chow advises to not e-file on a computer or utilize an online connection which is not confidential.

      Bottom line

      For most taxpayers, it is sensible to e-file a return because it is the most convenient way to submit 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 can ensure the information you provide to transmit to the IRS is going to be kept protected.