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

Is e-filing really 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 filed to the IRS are e-filed. 

In return, you can find any refund you are owed quicker, especially in the event that you have it directly deposited into your bank account.

However, what about security?  And can electronic filing actually provide you access to all the forms that you might need in case you’ve got a complex tax situation?  Are there ever situations when you can not e-file?  Let’s look at the advantages of e-filing, and whether it may be the very best filing option for your needs.

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing was received within 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived safely. 
  2. Timely refunds: When you publish a paper filing, it can take six to eight months to be given a tax refund.  With e-filing, you are going to receive your money in 3 weeks or not.  Choosing direct deposit can also accelerate the refund procedure.

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

  4. Easy payment process: If you owe the IRS money, it is easier to cover at your convenience when you e-file.  It’s possible to submit returns early and pay afterwards if necessary, 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, filing a credit card through a payment processor for a commission, or paying by check or money order. 

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

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

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

    1. Use 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.  The types do the math for you and offer standard guidance.  You can only do your federal return with all these forms. 
    2. Use an internet tax preparation service or tax applications: Tax preparation 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 software asks you simple questions about your own life and financing to guide you through the completion of your forms.  
    3. Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is typically limited based on income, and a few services cater to particular 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 authorized providers, but be aware this alternative is likely to be the most costly one. 

      Using online tax preparation software is far and away the favored approach of the majority of taxpayers.  In fact, the IRS says it expected over four in five tax returns to be filed through tax return prep software.

      Is e-filing really stable?

      While e-filing is convenient, you could be worried about safety — 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 turned out to be a very secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and sales at LegalShield. “In actuality, it may be more secure than paper filing since you’re sending your private information through an encrypted system rather than exposing your information in the mail.”

      Dennis Chow, vice president of data security at SCIS Security, clarifies that the IRS has put safety measures in place to keep your data safe.  “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted links “

      It is very important to employ a trustworthy service that will help you file your taxes.  Chow advises not to e-file on a computer or utilize an internet connection that is not confidential.

      Bottom line

      For most taxpayers, it makes sense to e-file a return because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment options.  Just make sure that you use tax planning software from a trusted source, so that you can make certain the information you provide to transmit to the IRS is going to be kept protected.