Warren Buffett Charity Lunch – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree about everything, but they’re largely on the exact same page in regards to e-filing individual income tax returns.

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

When you e-file your federal income tax return, you conserve the IRS money because its workers do not need to spend time manually processing your return. In return, you can find any refund you’re owed quicker, especially in the event that you have it directly deposited into your bank account.

However, what about safety?  And can electronic filing really provide you access to all the forms that you might need in case you’ve got 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 might be the very best filing option for your needs.

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

  1. Quick confirmation your forms are received: The IRS will confirm a tax filing has been received within 24 hours of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived . 
  2. Timely refunds: When you submit a paper filing, it can take six to eight weeks 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 procedure.

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

  4. Simple payment process: If you owe the IRS money, it’s simpler to cover at your advantage when you e-file.  You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline.  And you’re able to schedule electronic funds 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 choice to pay your balance by making use of the IRS Immediate pay service from the checking or savings accounts, filing a credit card through a payment processor for a commission, or paying by check or money order. 

  5. Digital storage of tax information: Submitting returns electronically means there’s a digital backup of your tax records.  If something happens to your paperwork, then you’ll have a digital backup.

The fantastic news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is easy.

How to e-file a tax return?

  • Free File Fillable Types — If your income is over $72,000 and you’re comfortable doing your earnings 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 only 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 options are a simple way to finish and e-file your own forms.  Some applications suppliers charge for their apps, Some are free.   The software asks you simple questions about your life and financing 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.  However, eligibility for free aid is normally restricted based on income, and some providers appeal to specific demographic groups.  The IRS maintains a record 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 the majority of taxpayers.  Actually, the IRS says it anticipated more than four in five tax returns to be submitted through tax return prep software.

    Is e-filing really secure?

    While e-filing is suitable, you may worry about safety — particularly with all these data breaches.  But experts agree this isn’t a problem that should dissuade you from e-filing.

    “In fact, it can be more secure than paper filing as you’re sending your personal information through an encrypted system as opposed to exposing your data in the email.”

    Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has put safety measures in place to keep your information safe.  “Trainers normally use IRS particular APIs that need token sessions,” Chow says.  “All of this is routed over TLS encrypted connections.”

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

    Bottom line

    For many taxpayers, it makes sense to e-file a return because 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 be certain to use tax preparation software from a dependable source, so you can ensure the information you supply to transmit to the IRS will be kept secure.