Warren Buffett Laguna House – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree on everything, but they are mostly on the exact same page in regards to e-filing individual income tax returns.

Nearly all individual income tax returns filed to the IRS are e-filed.  E-filing is a favorite as it’s a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you conserve the IRS money because its workers don’t have to spend time manually processing your return. In return, you could find any refund you are owed quicker, particularly in the event that you have it directly deposited to your bank accounts.

However, what about security?  And can digital filing actually provide you access to all of the forms you might need if you have a intricate tax situation?  Are there ever situations when you can not e-file?  Let us look at the advantages of e-filing, and if it might be the very best filing choice for your requirements.

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

  1. Quick confirmation your forms have been obtained: The IRS will confirm a tax filing has been received within 24 hours of digital submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived . 
  2. 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 are going to get your money in three weeks or not.  Choosing direct deposit can also speed up the refund procedure.

  3. Reduced chance of errors: In accordance with the IRS, there is around a 1% 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 yields compared with paper yields.

  4. Simple payment process: If you owe the IRS money, it is simpler to cover at your convenience if you e-file.  You can submit returns early and pay later if needed, provided that you pay from the April 15 filing deadline.  Additionally you have the choice to pay your balance by making use of the IRS Direct pay service from the checking or savings account, filing a credit card through a payment processor for a fee, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) can lead to interest and penalties.

  5. Digital storage of tax data: Submitting returns electronically means there is an electronic copy of your tax documents.  If something happens to your paperwork, then you will have a digital backup.

The good news: Most taxpayers do decide to e-file and find those benefits — and the process of doing so is simple.

The way to e-file a tax return?

  • Free File Fillable Types — 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 provide basic guidance.  You can only do your federal return with all these forms. 
  • Use an internet tax preparation tax or service software: Tax prep software and online filing services are alternatives.  These choices are a simple way to finish and e-file your own forms.  Some applications suppliers charge for their programs, Some are free.   The software asks you simple questions about your life and financing to guide you through the completion of your forms.  
  • Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free aid is normally restricted based on income, and a few providers cater to particular demographic groups. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a database of licensed providers, but be aware this alternative is very likely to be the most costly one. 

    Using online tax prep software is far and away the favored approach of most taxpayers.  Actually, the IRS says it expected more than four tax returns to be filed through tax return prep software.

    Is e-filing really secure?

    While e-filing is suitable, you may be worried about security — particularly with all these data breaches.  But experts agree that this is not a problem that 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 sales at LegalShield. “In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted system rather than exposing your data in the mail.”

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

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

    Bottom line

    For many taxpayers, it makes sense to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment options.  Just make certain that you 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 secure.