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

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

Americans and the IRS might not agree about everything, but they’re 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. 

When you e-file your federal income tax return, you conserve the IRS cash because its employees don’t need 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 to your bank account.

However, what about safety?  And can electronic filing really provide you access to all the forms that you might need if you’ve got a intricate tax situation?  Are there situations when you can’t e-file?  Let us look at the benefits of e-filing, and if it may be the best filing option for your requirements.

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

  1. Quick confirmation your forms are received: The IRS will confirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely. 

    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 get your money in three weeks or less.  Choosing direct deposit may also accelerate the refund process.

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

  3. Easy payment procedure: If you owe the IRS money, it’s simpler to cover at your convenience if you e-file.  It’s possible to submit returns early and pay later if necessary, as long as you pay by the April 15 filing deadline.  And you’re able to schedule electronic funds transfers to send the IRS what you owe on a date of your choosing again, provided that the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by making use of the IRS Immediate 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. 

  4. Digital storage of tax data: Submitting returns electronically implies there’s an electronic backup of your tax documents.  If something happens to your paperwork, you’ll have a digital backup.

The good news: Most taxpayers do opt 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 may have the ability to use the IRS Free File program. 
    2. Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your earnings without any help, you can use Free File Fillable Forms from the IRS. The forms do the math for you and provide basic guidance.  You can simply do your federal return with all these kinds. 
    3. Use an internet tax preparation service or tax software: Tax preparation software and online filing services are options.  These options are a simple way to complete and e-file your own forms.  Some applications providers charge for their programs, Some are free.   The software asks you simple questions about your own life and finances to guide you through the completion of your types.  
    4. Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields.  But eligibility for free help is normally restricted based on income, and a few providers cater to particular demographic groups. 
    5. Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they are authorized IRS e-file providers. The IRS maintains a database of authorized providers, but be aware this option is very likely to be the most costly one. 

Employing online tax preparation software is far and away the preferred approach of the majority of taxpayers.  In fact, the IRS says it expected over four tax returns to be submitted through tax return prep software.

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 this is not a problem that should deter you by e-filing.

“In fact, it can be more secure than paper filing as you’re sending your private information through an encrypted network as opposed to exposing your information in the mail.”

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

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

Bottom line

For many taxpayers, it is sensible to e-file a yield because it is the most convenient way to file your tax information to the IRS and it allows for timely refunds and effortless payment choices.  Just make sure that you use tax preparation software from a trusted source, so you may ensure the information you provide to transmit to the IRS will be kept protected.