Warren Buffett Average Annual Return – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree about everything, but they are mostly on the 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.  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 save the IRS cash because its employees do not need to spend time manually processing your return. And in return, you could find any refund you are owed quicker, particularly if you have it directly deposited into your bank accounts.

But what about safety?  And can digital filing actually provide you access to all the forms that you may need if you’ve got a intricate tax situation?  Are there situations when you can not e-file?  Let’s look at the advantages of e-filing, and if it might be the very best filing choice for your requirements.

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

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

    Timely refunds: When you publish 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 process.

  2. Reduced likelihood of errors: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed returns, compared with a 20% speed 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 process: If you owe the IRS money, it is easier to pay at your convenience if you e-file.  You can submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline.  And you can schedule electronic money transfers to easily 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 option to pay your balance by using the IRS Direct pay service from your checking account 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 interest and penalties.

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

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

The way to e-file a tax return?

  • Free File Fillable Types — If your income is over $72,000 and you are comfortable doing your taxes without assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide standard advice.  You can simply do your federal return with all these kinds. 
  • Utilize an online tax preparation service or tax applications: Tax preparation software and online filing services are alternatives.  These choices are a simple way to finish and e-file your forms.  Some applications suppliers charge for their programs, Some are liberated.   The program asks you simple questions about your life and finances to guide you through the completion of your forms.  
  • Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free help is typically limited based on earnings, and some providers appeal to specific demographic groups.  The IRS maintains a database of authorized providers, but be aware this alternative is very likely to be the most costly one. 

    Using online tax preparation software is far and away the preferred approach of the majority of taxpayers.  Actually, the IRS says it anticipated over four tax returns to be filed through tax return prep software.

    Is e-filing really secure?

    While e-filing is suitable, you could be worried about security — especially with all these data breaches.  But experts agree that this is not an issue that should deter you by e-filing.

    “E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, advertising and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your personal 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 the IRS has put safety measures in place to keep your information safe.  “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says.  “All of this can be routed over TLS encrypted connections”

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

    Bottom line

    For many 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 effortless payment options.  Just make sure to use tax preparation software from a dependable source, so that you may make certain the information which you supply to transmit to the IRS is going to be kept secure.