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

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

Americans and the IRS may not agree on everything, but they’re mostly on the exact same page in regards to e-filing individual income tax returns.

The majority of individual income tax returns submitted to the IRS are e-filed.  E-filing is popular as it’s a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you save the IRS cash because its workers don’t need to spend time manually processing your return. And in return, you can find any refund you’re owed quicker, especially if you have it directly deposited into your bank account.

However, what about security?  And can electronic filing really give you access to all the forms that you may need in case you have a complex tax situation?  Are there ever situations when you can not e-file?  Let us look at the benefits of e-filing, and if it might 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 have been obtained: The IRS will confirm a tax filing was received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely. 
  2. Timely refunds: When you submit a paper filing, it may take six to eight weeks to receive a tax refund.  With e-filing, you are going to receive your money in three weeks or not.  Choosing direct deposit may also speed up the refund procedure.

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

  4. Simple payment procedure: If you owe the IRS money, it’s easier to cover at your convenience if you e-file.  You can submit returns early and pay afterwards if needed, provided that 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 your checking or savings account, 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 lead to interest and penalties.

  5. Digital storage of tax information: Submitting returns electronically means there is a digital backup of your tax documents.  So if something happens to your paperwork, you’ll have an electronic backup.

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

The forms do the math for you and offer basic guidance.  You can only do your federal return with these kinds. 

  • Use an online tax preparation tax or service applications: Tax prep software and online filing services are alternatives.  These options are an easy way to complete and e-file your own forms.  Some applications suppliers charge for their apps, Some are liberated.   The program asks you simple questions about your own life and finances to guide you through the completion of your forms.  
  • Get free, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  But eligibility for free aid is typically limited based on earnings, and a few providers appeal to specific demographic groups. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they are licensed 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 prep software is far and away the favored approach of most taxpayers.  In fact, the IRS says it anticipated more than four tax returns to be submitted through tax return prep software.

    Is e-filing really stable?

    While e-filing is convenient, you may be worried about safety — particularly with all these data breaches.  But experts agree this isn’t an issue that should dissuade you by e-filing.

    “E-filing a tax return has proven to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, marketing and sales at LegalShield. “In fact, it may be more secure than paper filing as you’re sending your private information through an encrypted network rather than exposing your information in the mail.”

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

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

    Bottom line

    For most taxpayers, it is sensible to e-file a yield since 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 certain that you use tax planning software from a dependable source, so you may make certain the information you supply to transmit to the IRS will be kept secure.