Tax Season: E-File Your Taxes
The time between January 1st and April 15th is tax season. During this time, individuals prepare their financial statements and reports from the previous year. By April 15th, individuals must file their annual tax return. One way to file your taxes is to e-file.
What is e-file?
E-file is a system that transmits completed tax returns in a format that IRS computers can accept. To file taxes online, you’ll need to use tax software companies or a tax professional that can access the IRS’ e-file system.
Why should you e-file?
There are a few different reasons to e-file. The four main reasons to e-file are:
E-filing allows you to get your tax refund faster. Since you are virtually sending your return, you don’t need to wait for the postal service to deliver your return to the IRS. In addition, paper returns are processed more slowly. Refunds for paper returns are typically given in six to eight weeks. Most refunds are issued within 21 days. The fastest way to get your money is to combine your e-filing with direct deposit. This way, you don’t have to wait to receive the paper check.
E-filing gives you the ability to better track the standing of your returns. After you e-file, the IRS will inform you when it receives your return, when your return Is approved, and when it sends your refund.
With e-filing, you don’t need to send the IRS a copy of your W-2.
If you’re ready to prepare, but unsure of how much you’ll owe or what you’ll be refunded, you can file early but pay later. As long as you pay before the April 15th deadline, you can file early.
How much does it cost to e-file?
The cost to e-file varies. In some cases, the cost may be included in the price of the software. In other cases, there may be an additional fee. There are a few ways that you may be able to file for free. They include:
IRS’s Free File program
Free File is a list of software companies that offer free basic tax-prep software if your gross income is below a certain level.
Volunteer Income Tax Assistance, or VITA, offers free e-filing if you earned $54,000 or less. In addition, the Tax Counseling for the Elderly programs can help people who are over the age of 60.
Many states offer free filing options. Check the Federation of Tax Administrators to see a list of state filing options
When can’t you e-file?
Almost everyone can e-file. However, you won’t be able to e-file if:
- You are filing an amended return or a prior-year return
- You’re filing a form that e-file doesn’t support
- You’re claiming a dependent who is already on a different return
In these cases, you have to file your taxes the traditional way and print out and mail your return.