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

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

Americans and the IRS may not agree on everything, but they’re largely on the 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 as it’s a win-win for taxpayers and the IRS.

When you e-file your federal income tax return, you save the IRS money because its workers do not have to spend time manually processing your return. And in return, you can find any refund you are owed quicker, especially in the event that you have it directly deposited into your bank accounts.

However, what about safety?  And can digital filing really give you access to all of the forms that you might need in case you have a intricate tax situation?  Are there situations when you can’t e-file?  Let us look at the advantages of e-filing, and whether it may be the best filing option for your needs.

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

  1. Quick affirmation your forms are obtained: The IRS will affirm 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. 

    Timely refunds: When you publish a paper filing, it may take six to eight weeks to be given a tax refund.  With e-filing, you are going to get your money in three weeks or less.  Choosing direct deposit can also accelerate the refund process.

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

  3. Easy payment procedure: If you owe the IRS money, it’s easier to cover at your advantage when you e-file.  It’s possible to submit returns early and pay afterwards if needed, provided that you pay from the April 15 filing deadline.  You also have the choice to pay your balance by using the IRS Immediate pay service from the checking account or savings accounts, submitting a credit card through a payment processor for a commission, or paying by check or money order.  Just be aware delaying payment following the filing due date (typically April 15) will lead to penalties and interest.

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

The good news: Most taxpayers do decide to e-file and get those advantages — and the process of doing this is easy.

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

  • Free File Fillable Types — If your income is more than $72,000 and you are comfortable doing your earnings without help, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide basic advice.  You can only do your federal return with these forms. 
  • Use an internet tax preparation service or tax applications: Tax preparation software and online filing services are options.  These choices are a simple way to finish and e-file your own forms.  Some applications suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your own life and financing to guide you through the completion of your forms.  
  • Get free, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  But eligibility for free help is typically limited based on income, and a few providers cater to specific demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on helping filers that are 60 and older.  The IRS maintains a database of licensed 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 favored approach of the majority of taxpayers.  Actually, the IRS says it expected more than four tax returns to be submitted through tax return prep program.

    Is e-filing really stable?

    While e-filing is suitable, you may worry about security — particularly with all these data breaches.  But experts agree that this isn’t a problem which should deter you from e-filing.

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

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

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

    Bottom line

    For many taxpayers, it makes sense to e-file a return since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just make sure to use tax preparation software from a trusted source, so that you may make certain the information which you provide to transmit to the IRS is going to be kept protected.