Warren Buffett Retirement Plan – What to Consider When Filing My Taxes Online

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

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

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

In return, you could get any refund you are owed faster, especially if you have it directly deposited into your bank accounts.

However, what about safety?  And can digital filing actually give you access to all the forms you might need if you’ve got a complex tax situation?  Are there situations when you can not e-file?  Let us look at the advantages of e-filing, and whether it may be the very best filing choice for your requirements.

If you are 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 24 hours of electronic submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived safely. 
  2. Timely refunds: When you publish a paper filing, it can take six to eight weeks to be given a tax refund.  With e-filing, you’ll get your money in 3 weeks or less.  Choosing direct deposit may also accelerate the refund procedure.

  3. Reduced likelihood of mistakes: According to the IRS, there is around a 1 percent error rate on e-filed yields, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more information on problems discovered on e-filed yields compared with paper returns.

  4. Simple payment process: If you owe the IRS money, it’s simpler to pay at your convenience if you e-file.  It’s possible to submit returns early and pay later if necessary, provided that you pay by the April 15 filing deadline.  And you can schedule electronic funds transfers to easily send the IRS what you owe on a date of your choosing — again, as long as the IRS receives your payment by Tax Day. Additionally you have the option to pay your balance by using 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. 

  5. Digital storage of tax data: Submitting returns electronically means there is an electronic copy of your tax records.  If something happens to your paperwork, you will have an electronic backup.

The fantastic news: Most taxpayers do opt to e-file and find those advantages — and the process of doing so is easy.

You have four options for filing an electronically filed tax return to the IRS.

The forms do the math for you and provide standard guidance.  You can simply do your federal return with these forms. 

  • Use an online tax preparation service or tax software: Tax preparation software and online filing services are alternatives.  These options are a simple way to finish and e-file your own forms.  Some software providers charge for their apps, Some are free.   The program asks you simple questions about your life and finances to steer 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 returns.  But eligibility for free aid is typically limited based on income, and some services appeal to specific demographic groups.  The IRS maintains a record 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 anticipated 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 all these data breaches.  But experts agree that this isn’t an issue which should dissuade 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 data security at SCIS Security, explains the IRS has set security measures in place to keep your data safe.  “Vendors typically utilize IRS specific APIs that need ab sessions,” Chow says.  “All this is routed over TLS encrypted links .”

    It is important to use a trustworthy service to assist you file your taxes.  Chow advises to not e-file on a public computer or use an internet connection that is not confidential.

    Bottom line

    For most taxpayers, it is sensible to e-file a yield since it’s the most convenient way to file 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 can make certain the information which you provide to transmit to the IRS will be kept secure.