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

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

Americans and the IRS might not agree about everything, but they are largely on precisely the exact 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.  E-filing is popular because it is a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you save the IRS money because its employees do not have to spend time manually processing your return. And in return, you can find any refund you’re owed quicker, particularly in the event that you have it directly deposited into your bank account.

But what about safety?  And can digital filing really provide you access to all of the forms you may need if you have a intricate tax situation?  Are there ever situations when you can’t e-file?  Let’s look at the benefits of e-filing, and whether it might be the very best filing option for your requirements.

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

  1. Quick confirmation your forms are obtained: The IRS will affirm 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 safely. 

    Timely refunds: When you submit a paper filing, it may take six to eight weeks to be given a tax refund.  With e-filing, you are going to receive your money in 3 weeks or less.  Choosing direct deposit can also speed up the refund process.

  2. Reduced likelihood of mistakes: In accordance with the IRS, there is around a 1 percent 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 yields compared with paper returns.

  3. Easy payment process: If you owe the IRS money, it is simpler to cover at your advantage when you e-file.  You can submit returns early and pay later if needed, as long as you pay from the April 15 filing deadline.  And you can schedule electronic funds 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. You also have the option to pay your balance by making use of the IRS Immediate pay service from the checking account or savings accounts, filing 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 penalties and interest.

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

The good news: Most taxpayers do decide to e-file and get those advantages — and the practice of doing this is easy.

How to e-file a tax return?

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program.  The forms do the math for you and provide standard advice.  You can only do your federal return with all these kinds. 
    2. Utilize an online tax preparation tax or service applications: Tax preparation software and online filing services are alternatives.  These options are an easy way to complete and e-file your forms.  Some software providers charge for their apps, Some are free.   The software asks you simple questions about your life and financing to steer you through the completion of your types.  
    3. Get free, in-person tax help: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free help is normally restricted based on income, and some services appeal to specific demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older. 
    4. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they’re authorized IRS e-file providers. The IRS maintains a record of authorized providers, but be aware this option is likely to be the most costly one. 

Using online tax prep software is far and away the preferred approach of most taxpayers.  Actually, the IRS says it anticipated over four tax returns to be filed through tax return prep program.

Is e-filing really secure?

While e-filing is convenient, you may be worried about safety — particularly with all these data breaches.  But experts agree this is not an issue which should dissuade you from e-filing.

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

Dennis Chow, vice president of data 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 need token sessions,” Chow says.  “All this can be routed over TLS encrypted connections”

It is important to employ a trustworthy service to assist you record your taxes.  Chow advises to not e-file on a public computer or use an online connection which isn’t private.

Bottom line

For many taxpayers, it makes sense to e-file a yield since 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 be sure to use tax preparation software from a trusted source, so that you may ensure the information which you supply to transmit to the IRS will be kept protected.