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

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

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

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

If you e-file your federal income tax return, you save the IRS cash because its employees do not need to spend time manually processing your return. And in return, you could get any refund you’re owed faster, especially if you have it directly deposited to your bank accounts.

However, what about safety?  And can electronic filing actually give you access to all of the forms that you might need in case you have a complex tax situation?  Are there situations when you can not 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 have been obtained: The IRS will affirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 
  2. Timely refunds: When you publish a paper filing, it may take six to eight weeks to receive a tax refund.  With e-filing, you are going to receive your money in 3 weeks or less.  Choosing direct deposit can also accelerate the refund process.

  3. Reduced chance of mistakes: According to the IRS, there is approximately a 1 percent error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more information on problems discovered on e-filed returns compared with paper returns.

  4. Simple payment process: If you owe the IRS money, it’s easier to pay at your advantage if you e-file.  You can submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline.  You also have the option to pay your balance by making use of the IRS Direct pay service from the checking account 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 after the filing due date (typically April 15) can result in penalties and interest.

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

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

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you may be able to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is more than $72,000 and you’re comfortable doing your taxes without any assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide basic guidance.  You can simply do your federal return with all these forms. 
    3. Use an online tax preparation tax or service software: Tax preparation software and online filing services are alternatives.  These options are a simple way to finish and e-file your own forms.  Some applications suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your life and financing to steer you through the completion of your types.  
    4. Get complimentary, 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 earnings, and a few services cater to specific demographic groups. 
    5. Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re authorized IRS e-file providers. The IRS maintains a record of authorized providers, but you should be aware this option is very likely to be the most costly one. 

Using online tax prep software is far and away the preferred approach of the majority of taxpayers.  Actually, the IRS says it anticipated more than four in five 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 safety — particularly with so many data breaches.  But experts agree that this is not a problem which should dissuade you from e-filing.

“E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, marketing and sales at LegalShield. “In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted network as opposed to exposing your data in the mail.”

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

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

Bottom line

For most taxpayers, it is sensible to e-file a return because 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 make sure that you use tax planning software from a dependable source, so that you may make certain the information you provide to transmit to the IRS is going to be kept protected.