Warren Buffett Articles – What to Consider When Filing My Taxes Online

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

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

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

When you e-file your federal income tax return, you save the IRS money because its employees don’t need to spend time manually processing your return. In return, you could get any refund you are owed quicker, particularly if you have it directly deposited into your bank accounts.

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

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely. 

    Timely refunds: When you publish a paper filing, it may take six to eight months to be given a tax refund.  With e-filing, you’ll get your money in 3 weeks or less.  Choosing direct deposit may also accelerate the refund process.

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

  3. Easy payment procedure: If you owe the IRS money, it is simpler to pay at your convenience if you e-file.  You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline.  You also have the option to pay your balance by making use of the IRS Direct pay service from the checking or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) can result in penalties and interest.

  4. Digital storage of taxation data: Submitting returns electronically means there’s a digital backup of your tax documents.  So if something happens to your paperwork, you’ll have a digital backup.

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

The way to e-file a tax return?

You have four options for filing an electronically filed tax return to the IRS.

The forms do the math for you and offer standard guidance.  You can only do your federal return with all these forms. 

  • Utilize an internet tax preparation service or tax applications: Tax prep software and online filing services are options.  These choices are a simple way to finish and e-file your own forms.  Some software providers charge for their programs, Some are liberated.   The software asks you simple questions about your life and financing to steer you through the completion of your types.  
  • Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns.  But eligibility for free help is normally restricted based on income, and a few providers cater to particular demographic groups.  The IRS maintains a database of authorized providers, but be aware this alternative is likely to be the most costly one. 
  • Employing online tax preparation software is far and away the preferred approach of the majority of taxpayers.  In fact, the IRS says it anticipated more than four tax returns to be filed through tax return prep software.

    Is e-filing really stable?

    While e-filing is convenient, you could be worried about security — particularly with all these data breaches.  But experts agree this isn’t an issue which should dissuade you by 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 direction, advertising and revenue at LegalShield. “In actuality, it can be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the mail.”

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

    It is important to employ a trustworthy service to assist you file your taxes.  Chow advises not to e-file on a computer or utilize an internet connection which isn’t confidential.

    Bottom line

    For many taxpayers, it is sensible to e-file a return because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options.  Just make sure to use tax planning software from a dependable source, so that you can ensure the information which you provide to transmit to the IRS will be kept protected.