Warren Buffett Company Share – 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 on everything, but they are mostly on the same page in regards to e-filing individual income tax returns.

The majority of individual income tax returns submitted to the IRS are e-filed. 

In return, you could find any refund you are owed faster, especially if you have it directly deposited to your bank accounts.

However, what about safety?  And can digital filing actually provide you access to all the forms that you may need if you’ve got 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 may be the very best filing option for your requirements.

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

  1. Quick confirmation your forms have been obtained: 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 your forms have arrived . 

    Timely refunds: When you publish a paper filing, it can take six to eight weeks to be given a tax refund.  With e-filing, you’ll get your money in three weeks or less.  Choosing direct deposit may also accelerate the refund procedure.

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

  3. Simple payment procedure: If you owe the IRS money, it’s easier to pay at your convenience if you e-file.  It’s possible to submit returns early and pay afterwards if necessary, provided that you pay by the April 15 filing deadline.  Additionally you have the choice to pay your balance by making use of the IRS Immediate pay service from your checking account or savings account, filing a credit card through a payment processor for a fee, or paying by check or money order. 

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

The good news: Most taxpayers do decide to e-file and get those benefits — and the practice of doing this is simple.

The way to e-file a tax return?

You have four choices for submitting an electronically filed tax return to the IRS.

  • 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 types do the math for you and offer standard guidance.  You can simply do your federal return with all these kinds. 
  • Use an online tax preparation service or tax applications: Tax prep software and online filing services are alternatives.  These options are an easy 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 own life and financing to steer you through the completion of your forms.  
  • Get complimentary, in-person tax help: 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 some providers appeal to particular demographic groups.  By way of instance, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re authorized IRS e-file providers. The IRS maintains a database 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 preferred approach of the majority of taxpayers.  In fact, the IRS says it expected over four in five tax returns to be filed through tax return prep program.

    Is e-filing really secure?

    While e-filing is convenient, you could worry about security — especially with so many data breaches.  But experts agree that this isn’t an issue which should deter you from e-filing.

    “In actuality, it can be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your data in the mail.”

    Dennis Chow, vice president of information security at SCIS Security, clarifies the IRS has set security measures in place to keep your data safe.  “Vendors typically utilize IRS particular APIs that need token sessions,” Chow says.  “All of this can be routed over TLS encrypted links “

    It is very important to use a trustworthy service to assist 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 file your tax information to the IRS and it allows for timely refunds and effortless payment options.  Just be sure to use tax preparation software from a trusted source, so you can make certain the information you provide to transmit to the IRS is going to be kept secure.