Warren Buffett Self Made – What to Consider When Filing My Taxes Online

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

Americans and the IRS might not agree on everything, but they are largely on the same page in regards 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 workers do not need to spend time manually processing your return. In return, you can find any refund you’re owed quicker, particularly in the event that you have it directly deposited to your bank account.

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 situations when you can’t e-file?  Let’s look at the benefits of e-filing, and whether it might be the best filing option for your requirements.

If you are Considering e-filing, a Few of the advantages include:

  1. Quick affirmation your forms have been obtained: The IRS will affirm a tax filing has been received within 24 hours of digital 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 can take six to eight months to receive a tax refund.  With e-filing, you’ll receive your money in three weeks or not.  Choosing direct deposit can also accelerate the refund process.

  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% speed of errors on paper filings.  The IRS also provides more info on issues discovered on e-filed yields compared with paper returns.

  3. Simple payment process: If you owe the IRS money, it’s easier to pay at your advantage when you e-file.  It’s possible to submit returns early and pay later if necessary, as long as you pay from the April 15 filing deadline.  And you’re able to schedule electronic money 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. You also have the option to pay your balance by using the IRS Direct pay service from your checking account or savings accounts, submitting a credit card through a payment processor for a fee, or paying by check or money order. 

  4. Digital storage of tax information: Submitting returns electronically means there is a digital copy 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 advantages — and the practice of doing so is easy.

The types do the math for you and offer basic guidance.  You can simply do your federal return with all these kinds. 

  • Use an internet 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 applications suppliers charge for their apps, Some are liberated.   The program asks you simple questions about your life and financing to guide you through the completion of your types.  
  • Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free help is normally restricted based on income, and some services cater to specific demographic groups. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file returns for you if they’re licensed IRS e-file providers. The IRS maintains a record of licensed providers, but you should be aware this option is likely to be the most costly one. 

    Using online tax prep software is far and away the favored approach of the majority of taxpayers.  Actually, the IRS says it expected 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 — particularly with all these data breaches.  But experts agree this isn’t an issue which should deter you from e-filing.

    “E-filing a tax return has turned out to be an extremely secure way to file your taxes,” says Scott Grissom, vice president of product direction, advertising and revenue at LegalShield. “In actuality, it may be more secure than paper filing as you’re sending your private information through an encrypted system as opposed to exposing your information in the email.”

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

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

    Bottom line

    For many taxpayers, it is sensible to e-file a return since it is 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 to use tax preparation software from a trusted source, so you can make certain the information you provide to transmit to the IRS is going to be kept protected.