Warren Buffett Elon Musk – Should I E-file My Taxes Online

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

Americans and the IRS might not agree on 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.  E-filing is a favorite as it is a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you save the IRS cash because its workers do not have to spend time manually processing your return. In return, you can find any refund you are owed faster, especially if you have it directly deposited into your bank account.

But what about security?  And can digital filing really give you access to all the forms that you may need in case you’ve got a intricate tax situation?  Are there situations when you can’t e-file?  Let’s look at the advantages of e-filing, and whether it might be the very best filing option for your requirements.

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

  1. Quick affirmation your forms are received: The IRS will confirm a tax filing was received within one day of electronic 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 receive a tax refund.  With e-filing, you are going to receive your money in 3 weeks or not.  Choosing direct deposit can also speed up the refund process.

  2. Reduced likelihood of mistakes: According to the IRS, there’s around a 1 percent error rate on e-filed yields, compared with a 20% speed of errors 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.  And you’re able to schedule electronic money transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by making use of the IRS Immediate pay service from your checking or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order. 

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

The fantastic 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 options for submitting an electronically filed tax return to the IRS.

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could have the ability to use the IRS Free File program. 
    2. 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 advice.  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 options.  These choices are a simple way to complete and e-file your own forms.  Some applications providers charge for their apps, Some are free.   The program asks you simple questions about your life and financing to guide you through the completion of your forms.  
    4. Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free aid is typically limited based on earnings, and some services cater to specific demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.  The IRS maintains a database 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 the majority of taxpayers.  In fact, the IRS says it anticipated more than four in five tax returns to be submitted through tax return prep software.

      Is e-filing really stable?

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

      “E-filing a tax return has turned out to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product leadership, marketing and sales at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your information in the email.”

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

      It is very important to use a trusted service that will assist you file your taxes.  Chow advises to not e-file on a computer or utilize an online connection that is not confidential.

      Bottom line

      For most taxpayers, it is sensible to e-file a return since it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just be sure to use tax preparation software from a dependable source, so you can ensure the information which you supply to transmit to the IRS is going to be kept protected.