Warren Buffett Geico – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree about everything, but they are largely on the 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 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 in the event that you have it directly deposited to your bank accounts.

But what about safety?  And can electronic filing really provide you access to all the forms you may need in case you have a complex tax situation?  Are there ever situations when you can’t e-file?  Let’s look at the advantages of e-filing, and if it might be the very best filing choice for your needs.

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

  1. Quick affirmation your forms are obtained: The IRS will confirm a tax filing was received within one day of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely. 

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

  2. Reduced likelihood of errors: In accordance with the IRS, there’s around a 1 percent error rate on e-filed yields, compared with a 20% rate of errors on paper filings.  The IRS also provides more information on issues discovered on e-filed yields compared with paper yields.

  3. Easy payment procedure: If you owe the IRS money, it’s easier to pay at your convenience when you e-file.  It’s possible to 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 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. You also have the choice to pay your balance by using the IRS Immediate pay service from the checking or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) can result in interest and penalties.

  4. Digital storage of tax information: Submitting returns electronically implies there is an electronic copy of your tax records.  If something happens to your paperwork, you’ll have an electronic backup.

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

    1. Use IRS Free File: If your adjusted gross income is $72,000 or less you may have the ability to use the IRS Free File program.  The forms do the math for you and offer standard guidance.  You can only do your federal return with all these kinds. 
    2. Utilize an online tax preparation service or tax software: Tax prep software and online filing services are options.  These choices are an easy way to finish and e-file your forms.  Some applications providers charge for their apps, Some are liberated.   The software asks you simple questions about your life and finances to guide you through the completion of your forms.  
    3. Get free, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free help is normally restricted based on income, and a few services cater to particular demographic groups.  The IRS maintains a database 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 expected over four tax returns to be submitted through tax return prep software.

      Is e-filing really stable?

      While e-filing is convenient, you may worry about safety — particularly with so many data breaches.  But experts agree that this is not an issue which should dissuade you from e-filing.

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

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

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

      Bottom line

      For most taxpayers, it makes sense to e-file a yield since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just make sure to use tax preparation software from a trusted source, so you may make certain the information which you supply to transmit to the IRS is going to be kept secure.