Watch Becoming Warren Buffett Online Free – What to Consider When Filing My Taxes Online

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

Americans and the IRS may not agree on everything, but they are largely on the exact 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 popular because it’s a win-win for taxpayers and the IRS.

And in return, you could get any refund you are owed faster, particularly in the event that you have it directly deposited into your bank accounts.

However, what about safety?  And can digital filing actually provide you access to all the forms 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 benefits of e-filing, and if it may be the best filing option for your requirements.

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

  1. Quick affirmation your forms have been received: The IRS will confirm a tax filing was received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment that your forms have arrived safely. 

    Timely refunds: When you submit a paper filing, it can take six to eight months to receive 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 procedure.

  2. Reduced likelihood of errors: According to the IRS, there is around a 1% error rate on e-filed returns, compared with a 20% rate of mistakes on paper filings.  The IRS also provides more information on issues discovered on e-filed returns compared with paper yields.

  3. Easy payment process: If you owe the IRS money, it’s easier to cover at your convenience if you e-file.  You can submit returns early and pay afterwards if necessary, provided that 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, provided that the IRS receives your payment by Tax Day. You also have the choice to pay your balance by using the IRS Immediate pay service from your checking account or savings accounts, filing a credit card through a payment processor for a fee, or paying by check or money order. 

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

The good news: Most taxpayers do decide to e-file and find those advantages — and the practice of doing so is simple.

    1. Utilize IRS Free File: If your adjusted gross income is $72,000 or less you could be able to use the IRS Free File program.  The forms do the math for you and offer standard guidance.  You can simply do your federal return with these forms. 
    2. Utilize an online tax preparation tax or service software: Tax preparation software and online filing services are alternatives.  These options are an easy way to complete and e-file your forms.  Some applications providers charge for their programs, Some are liberated.   The software asks you simple questions about your life and finances to steer you through the completion of your forms.  
    3. Get complimentary, in-person tax help: In most states, you will find volunteers to help prepare and e-file returns.  However, eligibility for free aid is typically limited based on income, and some providers appeal to particular demographic groups.  The IRS maintains a database of authorized providers, but you should be aware this alternative is very likely to be the most costly one. 

      Using online tax prep software is far and away the favored approach of most taxpayers.  In fact, the IRS says it expected more than four tax returns to be submitted through tax return prep software.

      Is e-filing really secure?

      While e-filing is convenient, you could be worried about safety — particularly with all these data breaches.  But experts agree that this is not a problem that should deter you by e-filing.

      “E-filing a tax return has turned out to be a very secure way to file your taxes,” says Scott Grissom, vice president of product leadership, advertising and sales at LegalShield. “In actuality, it can be more secure than paper filing since 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 that the IRS has put safety measures in place to keep your information safe.  “Trainers normally use IRS particular APIs that need token sessions,” Chow says.  “All this can be routed over TLS encrypted links .”

      It’s important to use a trustworthy service that will help you record your taxes.  Chow advises to not e-file on a computer or utilize an online connection which isn’t confidential.

      Bottom line

      For most taxpayers, it makes sense to e-file a return since it’s the most convenient way to submit your tax information to the IRS and it allows for timely refunds and easy payment choices.  Just be sure to use tax preparation software from a dependable source, so you may ensure the information you supply to transmit to the IRS will be kept secure.