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

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

Americans and the IRS may not agree on everything, but they’re mostly on the exact same page in regards to e-filing individual income tax returns.

The majority of individual income tax returns submitted to the IRS are e-filed. 

And in return, you could get any refund you are owed faster, particularly if you have it directly deposited into your bank account.

But what about safety?  And can electronic filing actually give you access to all the forms you might need if you have a intricate tax situation?  Are there situations when you can not e-file?  Let’s look at the benefits of e-filing, and whether it might be the very 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 confirm a tax filing was received within 24 hours of digital submission.  For paper filers, the IRS does not send any acknowledgment that your forms have arrived . 

    Timely refunds: When you submit a paper filing, it can take six to eight months to be given 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 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 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’s simpler to pay at your convenience if you e-file.  You can submit returns early and pay afterwards if needed, as long as you pay by 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. Additionally you have the option to pay your balance by making use of the IRS Direct pay service from the checking 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 after the filing due date (typically April 15) will result in interest and penalties.

  4. Digital storage of taxation data: Submitting returns electronically means there is an electronic backup of your tax documents.  If something happens to your paperwork, you will have a digital backup.

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

You have four choices for submitting an electronically filed tax return to the IRS.

The types do the math for you and provide basic advice.  You can simply do your federal return with all these forms. 

  • Utilize an online tax preparation service or tax applications: Tax prep software and online filing services are alternatives.  These options are a simple way to finish and e-file your own forms.  Some applications providers charge for their apps, Some are free.   The program asks you simple questions about your own life and finances to steer you through the completion of your types.  
  • Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free help is normally restricted based on income, and some providers cater to particular demographic groups.  By way of example, Tax Counseling for the Elderly programs focus primarily on assisting filers who are 60 and older.  The IRS maintains a record of authorized providers, but you should be aware this alternative is likely to be the most costly one. 

    Employing online tax prep software is far and away the preferred 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 software.

    Is e-filing really stable?

    While e-filing is convenient, you could worry about security — especially with so many data breaches.  But experts agree this isn’t an issue that should dissuade you from e-filing.

    “E-filing a tax return has proven to be an extremely secure way to file your taxes,” states Scott Grissom, vice president of product leadership, advertising and revenue at LegalShield. “In actuality, it can 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 mail.”

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

    It is 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 internet connection which is not private.

    Bottom line

    For most taxpayers, it is sensible to e-file a yield because 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 to use tax planning software from a trusted source, so you may ensure the information you provide to transmit to the IRS is going to be kept protected.