Warren Buffett Berkshire Hathaway Letter 2015 – 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 largely on precisely 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. 

And in return, you can get any refund you’re owed quicker, particularly if you have it directly deposited into your bank accounts.

But what about security?  And can electronic filing actually give you access to all the forms that you may need in case you have a complex tax situation?  Are there ever situations when you can’t e-file?  Let us look at the benefits of e-filing, and whether it may be the very best filing choice for your requirements.

If you are Considering e-filing, a Few 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 electronic submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived . 
  2. 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 three weeks or less.  Choosing direct deposit may also speed up the refund process.

  3. Reduced likelihood of errors: According to the IRS, there’s approximately 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 returns.

  4. Simple payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file.  You can submit returns early and pay later if needed, provided that 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 the 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.

  5. Digital storage of tax data: Submitting returns electronically means there is a digital copy of your tax records.  So if something happens to your paperwork, then you’ll have an electronic backup.

The fantastic news: Most taxpayers do opt to e-file and get those advantages — and the process of doing so is simple.

The forms do the math for you and offer basic guidance.  You can simply do your federal return with these forms. 

  • Use an online tax preparation tax or service applications: Tax prep software and online filing services are options.  These options are an easy way to finish and e-file your forms.  Some applications providers charge for their apps, Some are free.   The program asks you simple questions about your own life and finances to guide you through the completion of your types.  
  • Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free aid is typically limited based on earnings, and a few services appeal to specific demographic groups. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re authorized IRS e-file providers. The IRS maintains a record of authorized providers, but you should be aware this alternative is likely to be the most costly one. 

    Employing online tax prep software is far and away the preferred approach of the majority of taxpayers.  Actually, the IRS says it expected over four in five 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 — especially with all these data breaches.  But experts agree this is not a problem which should deter you from e-filing.

    “E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, marketing and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your information in the mail.”

    Dennis Chow, vice president of data security at SCIS Security, explains the IRS has set safety measures in place to keep your data secure.  “Trainers normally use IRS specific APIs that require token sessions,” Chow says.  “All this can be routed over TLS encrypted links .”

    It is important to use a trusted service to help you file your taxes.  Chow advises to not e-file on a public computer or use an internet connection that isn’t confidential.

    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 make sure that you use tax preparation software from a dependable source, so that you can make certain the information you provide to transmit to the IRS is going to be kept secure.