Warren Buffett Mutual Funds – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree about everything, but they’re largely on precisely the exact same page in regards to e-filing individual income tax returns.

The majority of individual income tax returns submitted to the IRS are e-filed. 

And in return, you could get any refund you’re owed faster, especially in the event that you have it directly deposited to your bank account.

But what about security?  And can digital filing really give you access to all of the forms you might need in case you’ve got a intricate tax situation?  Are there situations when you can not e-file?  Let’s look at the benefits of e-filing, and if it might be the best filing option for your requirements.

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

  1. Quick confirmation your forms are obtained: The IRS will affirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment that 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 get your money in 3 weeks or not.  Choosing direct deposit may also speed up the refund process.

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

  3. Simple payment process: If you owe the IRS money, it is simpler to pay at your convenience when you e-file.  It’s possible to submit returns early and pay later if needed, provided that 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 or savings accounts, submitting 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 result in penalties and interest.

  4. Digital storage of taxation information: Submitting returns electronically means there’s a digital backup of your tax records.  So 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 practice of doing so is easy.

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

The forms do the math for you and provide basic advice.  You can only do your federal return with all these forms. 

  • Utilize an online 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 forms.  Some software suppliers charge for their programs, Some are liberated.   The program asks you simple questions about your own life and finances to guide you through the completion of your types.  
  • Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields.  However, eligibility for free aid is normally restricted based on income, and some providers appeal to specific demographic groups.  For instance, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older.  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 preparation software is far and away the favored approach of most taxpayers.  In fact, the IRS says it expected more than four tax returns to be filed through tax return prep software.

    Is e-filing really stable?

    While e-filing is suitable, you could worry about security — especially with so many data breaches.  But experts agree that this is not an issue which should deter you from e-filing.

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

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

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

    Bottom line

    For many taxpayers, it is sensible 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 choices.  Just be certain to use tax preparation software from a dependable source, so that you can ensure the information which you supply to transmit to the IRS will be kept secure.