Warren Buffett Dead Or Alive – 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 when it comes to e-filing individual income tax returns.

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

If you e-file your federal income tax return, you save the IRS money because its employees don’t need to spend time manually processing your return. In return, you could get any refund you’re owed quicker, especially in the event that you have it directly deposited to your bank account.

However, what about security?  And can electronic filing really give you access to all of the forms that you may need in case 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 if it may be the very best filing choice for your requirements.

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

  1. Quick affirmation your forms have been obtained: The IRS will confirm a tax filing has been received within one day 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 months to be given a tax refund.  With e-filing, you’ll receive your money in 3 weeks or less.  Choosing direct deposit can also accelerate the refund procedure.

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

  4. Easy payment procedure: If you owe the IRS money, it’s simpler to pay at your advantage if you e-file.  You can submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline.  And you can 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. You also have the option to pay your balance by making use of the IRS Direct pay service from the checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) will result in interest and penalties.

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

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

How to e-file a tax return?

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

The forms do the math for you and provide basic advice.  You can only do your federal return with these forms. 

  • Use an online tax preparation service or tax applications: Tax preparation software and online filing services are options.  These choices are a simple way to finish and e-file your forms.  Some software suppliers charge for their programs, Some are free.   The program asks you simple questions about your own life and financing to steer 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 yields.  But eligibility for free help is normally restricted based on earnings, and some providers cater to particular demographic groups. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns 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 very likely to be the most costly one. 
  • Employing online tax preparation software is far and away the favored approach of most taxpayers.  In fact, the IRS says it expected more than four in five tax returns to be filed through tax return prep software.

    Is e-filing really stable?

    While e-filing is convenient, you could worry about security — particularly with all these data breaches.  But experts agree that this isn’t an issue which should deter you by e-filing.

    “E-filing a tax return has turned out 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 system as opposed to exposing your data in the mail.”

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

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

    Bottom line

    For most taxpayers, it makes sense to e-file a return because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just make certain to use tax preparation software from a dependable source, so that you can make certain the information which you supply to transmit to the IRS is going to be kept protected.