Warren Buffett Stock Portfolio 2020 – Should I E-file My Taxes Online

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

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

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

When you e-file your federal income tax return, you conserve the IRS cash because its workers don’t have to spend time manually processing your return. And in return, you could find any refund you’re owed faster, particularly in the event that you have it directly deposited into your bank account.

However, what about safety?  And can digital filing really provide you access to all the forms you might need if you’ve got a complex tax situation?  Are there ever situations when you can’t e-file?  Let’s look at the benefits of e-filing, and if it may be the very best filing option for your requirements.

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing was received within one day of electronic submission.  For paper filers, the IRS does not send any acknowledgment your forms have arrived . 
  2. Timely refunds: When you publish a paper filing, it may take six to eight months to receive a tax refund.  With e-filing, you are going to receive your money in 3 weeks or not.  Choosing direct deposit may also accelerate the refund procedure.

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

  4. Simple payment process: If you owe the IRS money, it is easier to cover at your advantage when you e-file.  You can submit returns early and pay later if needed, as long as you pay by the April 15 filing deadline.  Additionally you have the option to pay your balance by using the IRS Immediate pay service from your checking or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order. 

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

The good news: Most taxpayers do opt to e-file and find those benefits — and the process of doing so is simple.

  • Free File Fillable Types — If your income is more than $72,000 and you are comfortable doing your taxes without assistance, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer standard advice.  You can simply do your federal return with all these forms. 
  • Use an internet tax preparation service or tax software: Tax preparation software and online filing services are alternatives.  These choices are an easy way to finish and e-file your own forms.  Some software providers charge for their programs, Some are free.   The program asks you simple questions about your life and finances to steer you through the completion of your types.  
  • Get complimentary, in-person tax help: 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. 
  • Hire a paid preparer: Paid tax preparers, such as CPAs, can e-file yields for you if they’re authorized IRS e-file providers. The IRS maintains a database 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 preferred approach of most taxpayers.  In fact, the IRS says it expected over four in five tax returns to be submitted through tax return prep program.

    Is e-filing really secure?

    While e-filing is convenient, you could worry about safety — particularly with so many data breaches.  But experts agree that this is not an issue which should dissuade you by e-filing.

    “E-filing a tax return has turned out to be a very secure way to file your taxes,” states Scott Grissom, vice president of product leadership, 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 network rather than exposing your information in the mail.”

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

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

    Bottom line

    For most taxpayers, it is sensible to e-file a yield since it is the most convenient way to submit your tax information to the IRS and it allows for timely refunds and effortless payment choices.  Just make certain that you use tax planning software from a trusted source, so you may ensure the information you supply to transmit to the IRS will be kept secure.