Warren Buffett Original Investment – What to Consider When Filing My Taxes Online

Is e-filing really a much 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.

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

When you e-file your federal income tax return, you save the IRS cash because its workers don’t have to spend time manually processing your return. And in return, you could get any refund you are owed quicker, especially in the event that you have it directly deposited into your bank account.

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

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

  1. Quick affirmation your forms are obtained: The IRS will confirm a tax filing was received within one day of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 

    Timely refunds: When you submit a paper filing, it can take six to eight months 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 process.

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

  3. Simple payment procedure: If you owe the IRS money, it is simpler to pay 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.  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, submitting a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment after the filing due date (typically April 15) can result in interest and penalties.

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

The good news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing so is simple.

The way to e-file a tax return?

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could have the ability to use the IRS Free File program. 
    2. Free File Fillable Types — If your income is more than $72,000 and you are comfortable doing your taxes without any help, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer basic guidance.  You can simply do your federal return with all these forms. 
    3. Use an internet tax preparation tax or service software: Tax prep software and online filing services are alternatives.  These choices are an easy 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.  
    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 aid is typically limited based on income, and some providers cater to particular demographic groups.  By way of instance, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. 
    5. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re authorized IRS e-file providers. The IRS maintains a database of licensed providers, but you should be aware this option is likely to be the most costly one. 

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

Is e-filing really secure?

While e-filing is convenient, you could worry about safety — particularly with so many data breaches.  But experts agree that this isn’t a problem that should deter you by e-filing.

“In fact, it may be more secure than paper filing since you’re sending your personal information through an encrypted system rather than exposing your information in the mail.”

Dennis Chow, vice president of information security at SCIS Security, explains the IRS has set safety measures in place to keep your data safe.  “Trainers normally use IRS particular APIs that require ab sessions,” Chow says.  “All of this is routed over TLS encrypted connections”

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 is not private.

Bottom line

For many taxpayers, it makes sense to e-file a yield because it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just be sure that you use tax preparation software from a dependable source, so that you can make certain the information which you supply to transmit to the IRS is going to be kept secure.