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

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

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

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

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

But what about security?  And can digital filing actually provide you access to all of the forms that you may need if you’ve got a complex tax situation?  Are there ever situations when you can not e-file?  Let’s look at the benefits of e-filing, and if it may be the very best filing choice for your needs.

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

  1. Quick affirmation your forms are received: The IRS will affirm 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 . 

    Timely refunds: When you submit 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 not.  Choosing direct deposit may also accelerate the refund procedure.

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

  3. Easy payment process: If you owe the IRS money, it’s easier to cover at your advantage when you e-file.  You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline.  You also have the option to pay your balance by using 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. 

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

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

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

The types do the math for you and offer basic guidance.  You can simply do your federal return with all these forms. 

  • Utilize an internet tax preparation service or tax software: Tax prep software and online filing services are alternatives.  These options are a simple way to finish and e-file your own forms.  Some software suppliers charge for their apps, Some are liberated.   The program asks you simple questions about your life and financing to guide you through the completion of your types.  
  • Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  But eligibility for free aid is normally restricted based on earnings, and a few providers cater to specific demographic groups.  The IRS maintains a database of licensed providers, but be aware this option is very likely to be the most costly one. 
  • Employing online tax prep software is far and away the favored approach of most taxpayers.  In fact, the IRS says it anticipated over four tax returns to be submitted through tax return prep software.

    Is e-filing really secure?

    While e-filing is convenient, you could be worried about safety — particularly with all these data breaches.  But experts agree 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 personal information through an encrypted system rather than exposing your information in the mail.”

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

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

    Bottom line

    For many taxpayers, it makes sense to e-file a yield because 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 certain that you use tax preparation software from a trusted source, so you can ensure the information you provide to transmit to the IRS is going to be kept secure.