Warren Buffett Berkshire Hathaway Annual Meeting – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree on everything, but they’re largely on precisely the exact 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. 

And in return, you could find any refund you’re owed quicker, especially if you have it directly deposited to your bank accounts.

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

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

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

    Timely refunds: When you submit a paper filing, it can take six to eight weeks to receive 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 procedure.

  2. Reduced likelihood of errors: According to the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% rate of errors on paper filings.  The IRS also provides more info on problems discovered on e-filed returns compared with paper yields.

  3. Easy payment process: If you owe the IRS money, it is simpler to pay at your convenience when you e-file.  You can submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline.  You also have the option to pay your balance by using 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.  Just be aware delaying payment after the filing due date (typically April 15) can result in interest and penalties.

  4. Digital storage of tax information: Submitting returns electronically implies there’s an electronic backup of your tax records.  If something happens to your paperwork, then you will have an electronic backup.

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

The way to e-file a tax return?

    1. Use IRS Free File: If your adjusted gross income is $72,000 or less you may have the ability to use the IRS Free File program.  The forms do the math for you and offer basic guidance.  You can only do your federal return with these kinds. 
    2. Utilize an online tax preparation tax or service software: Tax prep software and online filing services are options.  These options are a simple way to finish and e-file your forms.  Some applications providers charge for their programs, Some are liberated.   The program asks you simple questions about your life and financing to steer you through the completion of your types.  
    3. Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  But eligibility for free aid is normally restricted based on earnings, and a few providers cater to particular demographic groups. 
    4. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re licensed IRS e-file providers. The IRS maintains a database of licensed providers, but you should be aware this alternative is very likely to be the most costly one. 

Using online tax preparation software is far and away the favored approach of most taxpayers.  In fact, the IRS says it expected more than four tax returns to be submitted through tax return prep software.

Is e-filing really secure?

While e-filing is convenient, you could worry about safety — particularly with all these data breaches.  But experts agree this is not an issue which should dissuade 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 direction, marketing and sales 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, explains that the IRS has set safety measures in place to keep your data secure.  “Trainers normally use IRS particular APIs that require ab sessions,” Chow says.  “All of this is routed over TLS encrypted links .”

It is important to use a trustworthy service to help you record your taxes.  Chow advises not to e-file on a computer or use an online connection which isn’t confidential.

Bottom line

For most taxpayers, it is sensible to e-file a yield since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options.  Just make certain to use tax planning 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.