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

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

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

Nearly all individual income tax returns filed to the IRS are e-filed.  E-filing is a favorite as it’s a win-win for taxpayers and the IRS.

And in return, you can get any refund you are owed quicker, especially if you have it directly deposited into your bank accounts.

But what about safety?  And can digital filing actually provide you access to all of 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 if it might be the very best filing option for your requirements.

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

  1. Quick confirmation your forms are obtained: The IRS will confirm a tax filing has been received within one day of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived . 

    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 get your money in three weeks or less.  Choosing direct deposit may also speed up the refund procedure.

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

  3. Simple payment procedure: If you owe the IRS money, it is easier to cover at your advantage if you e-file.  You can 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 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 choice to pay your balance by making use of the IRS Immediate pay service from your checking account or savings account, filing a credit card through a payment processor for a commission, or paying by check or money order. 

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

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

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or not as you could have the ability to use the IRS Free File program. 
    2. Free File Fillable Forms — If your income is over $72,000 and you’re comfortable doing your taxes without help, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide basic guidance.  You can only do your federal return with all these forms. 
    3. Utilize an internet tax preparation tax or service 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 applications providers charge for their programs, Some are liberated.   The program asks you simple questions about your life and financing to steer you through the completion of your forms.  
    4. Get free, in-person tax aid: In most states, you can find volunteers to help prepare and e-file returns.  However, eligibility for free aid is normally restricted based on earnings, and a few providers cater to particular demographic groups.  The IRS maintains a record of authorized providers, but be aware this alternative 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.  In fact, the IRS says it expected more than four in five 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 safety — especially with so many data breaches.  But experts agree this isn’t a problem which should deter you from 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, advertising and sales at LegalShield. “In fact, it can be more secure than paper filing since you’re sending your private information through an encrypted network as opposed to 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 safe.  “Vendors typically utilize IRS specific APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted links .”

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

      Bottom line

      For many taxpayers, it is sensible to e-file a yield because it’s the most convenient way to file your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just be sure that you use tax planning software from a dependable source, so that you can ensure the information you provide to transmit to the IRS is going to be kept secure.