When Did Warren Buffett Become A Billionaire – What to Consider When Filing My Taxes Online

Is e-filing a 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.

Nearly all individual income tax returns filed to the IRS are e-filed.  E-filing is popular because 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 do not need to spend time manually processing your return. And in return, you could get any refund you’re owed quicker, particularly if you have it directly deposited to your bank account.

However, what about security?  And can electronic filing actually give you access to all of the forms that you may need in case you’ve got a complex tax situation?  Are there ever situations when you can’t e-file?  Let us look at the advantages of e-filing, and if it might be the very best filing choice for your needs.

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

  1. Quick confirmation your forms are received: The IRS will affirm a tax filing has been received within 24 hours of digital submission.  For paper filers, the IRS doesn’t send any acknowledgment your forms have arrived . 
  2. Timely refunds: When you submit a paper filing, it may take six to eight weeks to be given a tax refund.  With e-filing, you are going to receive your money in three weeks or less.  Choosing direct deposit may also accelerate the refund process.

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

  4. Easy payment procedure: If you owe the IRS money, it’s simpler to pay at your advantage 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 can schedule electronic funds transfers to easily 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 the checking or savings account, submitting 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 is an electronic copy of your tax records.  So if something happens to your paperwork, then you’ll have a digital backup.

The fantastic news: Most taxpayers do decide to e-file and find those advantages — and the process of doing this is simple.

The way to e-file a tax return?

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

  • Free File Fillable Types — If your income is over $72,000 and you’re comfortable doing your taxes without any help, you can use Free File Fillable Forms from the IRS. The types do the math for you and provide standard advice.  You can only do your federal return with all these kinds. 
  • Use an internet tax preparation service or tax software: Tax preparation software and online filing services are alternatives.  These choices are a simple way to finish and e-file your forms.  Some applications suppliers charge for their programs, Some are free.   The program asks you simple questions about your own life and financing to steer you through the completion of your types.  
  • Get complimentary, in-person tax aid: In most states, you will find volunteers to help prepare and e-file yields.  However, eligibility for free aid is normally restricted based on earnings, and a few services cater to specific demographic groups.  The IRS maintains a database of licensed providers, but you should be aware this alternative is very likely to be the most costly one. 
  • Employing online tax prep software is far and away the preferred approach of most taxpayers.  In fact, the IRS says it expected over four 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 all these data breaches.  But experts agree this isn’t a problem which should dissuade you from e-filing.

    “In actuality, it can be more secure than paper filing since you’re sending your personal information through an encrypted system as opposed to exposing your data in the mail.”

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

    It’s important to use a trusted service to assist you record your taxes.  Chow advises to not e-file on a computer or use an internet connection that is not private.

    Bottom line

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