Warren Buffett Business Valuation Formula – 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 same page in regards to e-filing individual income tax returns.

Nearly all individual income tax returns submitted to the IRS are e-filed. 

In return, you could get any refund you are owed quicker, especially if you have it directly deposited to your bank account.

But what about safety?  And can digital filing actually provide you access to all the forms that you might need if you have a complex tax situation?  Are there ever situations when you can not e-file?  Let us look at the advantages of e-filing, and whether it might be the best filing option for your needs.

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely. 
  2. Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given a tax refund.  With e-filing, you are going to receive your money in 3 weeks or less.  Choosing direct deposit may also speed up the refund process.

  3. Reduced likelihood of errors: 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 information on issues discovered on e-filed returns compared with paper returns.

  4. Easy payment process: If you owe the IRS money, it is easier to pay at your advantage if you e-file.  You can submit returns early and pay afterwards if needed, as long as you pay by the April 15 filing deadline.  And you’re able to schedule electronic funds transfers to send the IRS what you owe on a date of your choosing — again, provided that the IRS receives your payment by Tax Day. Additionally you have the choice to pay your balance by making use of 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. 

  5. Digital storage of taxation data: Submitting returns electronically implies there is a digital copy of your tax records.  If something happens to your paperwork, then you’ll have a digital backup.

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

How to e-file a tax return?

    1. Use IRS Free File: If your adjusted gross income is $72,000 or not as you may be able 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 taxes 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 preparation software and online filing services are alternatives.  These choices are an easy way to complete and e-file your own forms.  Some applications providers charge for their programs, Some are free.   The program asks you simple questions about your own life and finances to steer you through the completion of your forms.  
    4. Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free help is normally restricted based on income, and a few providers appeal to specific demographic groups.  By way of instance, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older.  The IRS maintains a record of licensed providers, but you should be aware this option is very likely to be the most costly one. 

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

      Is e-filing really stable?

      While e-filing is suitable, you may worry about safety — especially with so many data breaches.  But experts agree that this isn’t 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,” states Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your personal information through an encrypted network rather than exposing your information in the mail.”

      Dennis Chow, vice president of data security at SCIS Security, explains the IRS has put safety measures in place to keep your data secure.  “Vendors typically utilize IRS specific APIs that require ab sessions,” Chow says.  “All this is routed over TLS encrypted connections”

      It’s important to employ a trustworthy service to help you record your taxes.  Chow advises not to e-file on a computer or use an online connection that is not private.

      Bottom line

      For many taxpayers, it makes sense to e-file a yield because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options.  Just be certain that you use tax planning software from a trusted source, so you can ensure the information which you supply to transmit to the IRS will be kept secure.