EVERYTHING YOU NEED TO KNOW ABOUT
E-FILING YOUR INCOME TAXES!
E-Filing (or electronically) filing income tax returns has gained popularity during the last few years. This month’s article discusses some of the ins and outs of e-filing your income tax return.
E-Filing can offer a number of advantages. It’s relatively easy and efficient and, of course, eliminates having to fill out paper forms. If you owe money, you can e-file and authorize an electronic funds withdrawal or pay by credit card. You usually receive an electronic proof of receipt within 48 hours that the IRS has received your tax return. Your return can be quickly and automatically checked for errors and other missing information. If you are entitled to a refund, you can receive it much faster through direct deposit to your bank account or even a check in the mail. Your chance of being audited does not differ whether you e-file or file a paper return. E-Filing is available for all individual income tax returns, so the choice is entirely yours. Federal and State Returns can both be e-filed. Finally, fear not- your personal and bank account information is safe guarded.
There are many ways in which to E-file. You can use a tax professional, purchase commercially available software, or download software from the internet. All will accomplish the same goal. Before you can file your tax return, either by paper or using e-file, you will need all of your tax records and information. It is important to file a complete return without any errors or missing information or you risk hearing from the IRS or your e-filed return will be rejected.
You can sign your e-filed return by either using a Self-Select PIN for a completely paperless return, or by signing FORM #8453 (#8453-OL when done on-line), U.S. Individual Income Tax Declaration for an IRS e-file return. Selecting a PIN number alleviates this added step. The IRS sends an acknowledgement, usually within 48 hours, stating that the return has been accepted or rejected. If rejected, any errors will need to be corrected and the return submitted again.
If you owe money, you can make pay in 3 ways:
By authorizing an electronic withdrawal form a checking or savings account.
By credit card
By mailing a check or money order to the IRS.
It is important to know that e-filing does not give you extra time to pay if you owe money or are required to make quarterly estimated tax payments.
If you have a refund coming, you can receive the money in 2 ways:
Having the IRS mail you a check
Having a direct deposit made to your checking or savings account.
Of course, if you are not comfortable with computers, the internet, or simply prefer to do a paper return, the choice is still yours to prepare and file a “paper return” the old fashion way!
Editors Note: