Warren Buffett Keystone Xl – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree on everything, but they’re largely on precisely the same page when it comes to e-filing individual income tax returns.

The majority of individual income tax returns filed to the IRS are e-filed.  E-filing is popular as it’s a win-win for taxpayers and the IRS.

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

However, what about security?  And can electronic filing actually give you access to all of the forms you may need if you have a complex tax situation?  Are there 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 choice for your requirements.

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

  1. Quick affirmation your forms are received: The IRS will affirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS does not send any acknowledgment that 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 three weeks or less.  Choosing direct deposit can also accelerate the refund process.

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

  3. Simple payment procedure: If you owe the IRS money, it is easier to pay at your convenience if you e-file.  You can submit returns early and pay later if needed, provided that you pay by the April 15 filing deadline.  Additionally you have the choice to pay your balance by using the IRS Direct pay service from your checking or savings account, submitting a credit card through a payment processor for a fee, or paying by check or money order. 

  4. Digital storage of taxation data: Submitting returns electronically means there’s a digital backup of your tax documents.  So 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 benefits — and the practice of doing so is simple.

How to e-file a tax return?

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

  • Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your taxes without any assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer standard guidance.  You can simply do your federal return with these forms. 
  • Utilize an online tax preparation tax or service applications: Tax preparation software and online filing services are alternatives.  These choices are an easy way to finish and e-file your own forms.  Some software providers charge for their programs, Some are free.   The program asks you simple questions about your own life and financing to guide you through the completion of your forms.  
  • Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free aid is typically limited based on earnings, and a few services cater to specific demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on helping filers who are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re licensed IRS e-file providers. The IRS maintains a record of licensed providers, but be aware this alternative is likely to be the most costly one. 
  • Using online tax preparation software is far and away the preferred approach of the majority of taxpayers.  In fact, the IRS says it expected over four tax returns to be filed through tax return prep software.

    Is e-filing really stable?

    While e-filing is suitable, you may be worried about security — especially with so many data breaches.  But experts agree this isn’t an issue which should dissuade you from e-filing.

    “E-filing a tax return has proven to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In actuality, it can be more secure than paper filing since you’re sending your private information through an encrypted system as opposed to exposing your information in the mail.”

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

    It’s very important to use a trusted service to assist 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 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 that you 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 protected.