Warren Buffett Net – 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 largely on the same page in regards to e-filing individual income tax returns.

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

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

However, what about safety?  And can electronic filing actually provide you access to all of the forms you may need if you’ve got a complex tax situation?  Are there situations when you can’t e-file?  Let us look at the advantages of e-filing, and whether it might be the 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 affirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived safely. 

    Timely refunds: When you submit a paper filing, it may 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 can also speed up the refund procedure.

  2. Reduced chance of mistakes: According to the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more info on issues discovered on e-filed yields compared with paper returns.

  3. Easy payment process: If you owe the IRS money, it’s 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.  And you can schedule electronic money transfers to send the IRS what you owe on a date of your choosing again, as long as the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by using the IRS Immediate pay service from the checking or savings account, submitting a credit card through a payment processor for a commission, or paying by check or money order. 

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

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

How to e-file a tax return?

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

The forms do the math for you and offer standard advice.  You can only do your federal return with all these kinds. 

  • Utilize 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 forms.  Some software suppliers charge for their programs, Some are free.   The software asks you simple questions about your own life and finances to steer you through the completion of your forms.  
  • Get free, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free aid is normally restricted based on earnings, and a few providers appeal to particular demographic groups. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re licensed IRS e-file providers. The IRS maintains a record of licensed providers, but be aware this alternative is very likely to be the most costly one. 

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

    Is e-filing really secure?

    While e-filing is suitable, you could be worried about security — particularly with so many data breaches.  But experts agree that this isn’t a problem that should deter you from e-filing.

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

    Dennis Chow, vice president of data security at SCIS Security, explains that the IRS has put 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 not to e-file on a public computer or utilize an internet connection which isn’t confidential.

    Bottom line

    For most taxpayers, it is sensible to e-file a return because it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options.  Just be sure to use tax planning software from a dependable source, so you may make certain the information which you supply to transmit to the IRS is going to be kept protected.