Warren Buffett Teva 2019 – What to Consider When Filing 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 largely on precisely the exact 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.  E-filing is popular because it’s a win-win for taxpayers and the IRS.

If you e-file your federal income tax return, you conserve the IRS money because its workers don’t have to spend time manually processing your return. In return, you can get any refund you are owed quicker, especially if you have it directly deposited into your bank account.

However, what about security?  And can digital filing really provide you access to all of the forms that you may need in case you have a complex tax situation?  Are there ever situations when you can’t e-file?  Let’s look at the advantages of e-filing, and if it may be the very best filing choice for your requirements.

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

  1. Quick confirmation your forms have been received: The IRS will confirm a tax filing has been received within one day of electronic submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived safely. 

    Timely refunds: When you publish a paper filing, it can take six to eight months to be given a tax refund.  With e-filing, you are going to receive your money in 3 weeks or less.  Choosing direct deposit may also accelerate the refund process.

  2. Reduced chance of errors: In accordance with the IRS, there’s approximately a 1 percent error rate on e-filed yields, compared with a 20% rate of errors on paper filings.  The IRS also provides more information on problems discovered on e-filed returns compared with paper yields.

  3. Easy payment procedure: If you owe the IRS money, it’s simpler to cover at your convenience if 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.  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 choice to pay your balance by using the IRS Direct pay service from the checking account or savings accounts, filing a credit card through a payment processor for a fee, 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 taxation information: Submitting returns electronically implies there is an electronic backup of your tax documents.  So if something happens to your paperwork, you’ll have a digital backup.

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

  • Free File Fillable Types — If your income is over $72,000 and you’re comfortable doing your earnings without any help, you can use Free File Fillable Forms from the IRS. The types do the math for you and offer basic advice.  You can simply do your federal return with these forms. 
  • Use an online tax preparation tax or service applications: Tax prep software and online filing services are options.  These options are a simple way to complete and e-file your forms.  Some applications suppliers charge for their apps, Some are liberated.   The software asks you simple questions about your own life and finances to guide you through the completion of your forms.  
  • Get complimentary, in-person tax help: In most states, you can find volunteers to help prepare and e-file yields.  But eligibility for free help is typically limited based on income, and some services cater to specific demographic groups.  For example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older. 
  • Hire a paid preparer: Paid tax preparers, including CPAs, can e-file yields for you if they are licensed IRS e-file providers. The IRS maintains a database of authorized providers, but be aware this alternative 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.  In fact, the IRS says it anticipated over four in five tax returns to be submitted through tax return prep program.

    Is e-filing really stable?

    While e-filing is suitable, you may be worried about safety — especially with all these data breaches.  But experts agree this isn’t a problem that should dissuade you from e-filing.

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

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

    It is very important to use a trustworthy service to assist you file your taxes.  Chow advises to not e-file on a computer or utilize an internet connection which isn’t confidential.

    Bottom line

    For most taxpayers, it makes sense 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 that you use tax planning software from a trusted source, so you may make certain the information you provide to transmit to the IRS will be kept secure.