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

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

Americans and the IRS might not agree on everything, but they are mostly on the exact same page when it comes to e-filing individual income tax returns.

Nearly all individual income tax returns submitted 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 conserve the IRS money because its employees do not need to spend time manually processing your return. In return, you could find any refund you’re owed faster, especially in the event that you have it directly deposited into your bank accounts.

However, what about safety?  And can digital filing actually give you access to all of the forms that you might need if you have 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 might be the best filing choice for your needs.

If you’re 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 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived . 

    Timely refunds: When you publish a paper filing, it may take six to eight weeks to receive a tax refund.  With e-filing, you’ll receive your money in three weeks or less.  Choosing direct deposit can also speed up the refund procedure.

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

  3. Simple payment process: If you owe the IRS money, it’s simpler to pay at your advantage if you e-file.  You can submit returns early and pay afterwards if necessary, as long as you pay from the April 15 filing deadline.  Additionally you have the choice to pay your balance by making use of 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. 

  4. Digital storage of tax information: Submitting returns electronically implies there’s an electronic backup of your tax records.  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 benefits — and the process of doing this is easy.

How to e-file a tax return?

  • Free File Fillable Forms — If your income is over $72,000 and you are comfortable doing your taxes without any assistance, you can use Free File Fillable Forms from the IRS. The forms do the math for you and offer basic advice.  You can only do your federal return with these kinds. 
  • Utilize 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 own forms.  Some applications providers charge for their programs, Some are free.   The software asks you simple questions about your life and finances to guide you through the completion of your forms.  
  • Get complimentary, in-person tax aid: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free aid is normally restricted based on income, and a few providers appeal to particular demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers that are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file returns for you if they are licensed IRS e-file providers. The IRS maintains a database of licensed providers, but you should be aware this alternative is likely to be the most costly one. 
  • Employing online tax prep software is far and away the preferred approach of the majority of taxpayers.  Actually, the IRS says it anticipated over four in five tax returns to be filed through tax return prep program.

    Is e-filing really secure?

    While e-filing is convenient, you could worry about security — especially with all these data breaches.  But experts agree this isn’t an issue which should dissuade you from e-filing.

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

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

    It’s very important to use a trusted service that will help you file your taxes.  Chow advises not to e-file on a public computer or utilize an online connection that is not private.

    Bottom line

    For many taxpayers, it makes sense 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 that you use tax planning software from a dependable source, so you may ensure the information which you supply to transmit to the IRS will be kept secure.