Why You Should E-File Your Taxes

Do you file your 2009 income taxes electronically or still do it the old fashion way?

I never used E-file, not since when I knew there’s such an option to file my tax returns. The reason for me to avoid e-filing my taxes is very simple: I didn’t have a refund to claim. Since we seem to always own Uncle Sam money, I really wasn’t that eager to let the IRS take the money from us faster. So every year for the past few years, I printed out our tax forms and waited till April 15th to mail them out. I know this isn’t the most efficient way to file our taxes and waiting in the long line on the deadline day in the post office wasn’t fun at all, there’s just not enough motivation for me to use e-filing. However, if the government owns me money instead, I would file our taxes on the day when I have all the tax documents (I still haven’t got all the tax forms yet) and file our returns with e-filing right away because I know that all the benefits of using e-filing will get me the refund faster. If you expect a refund, there are plenty of reasons to use e-file, just like there are many benefits of using direct deposit.

Still not convinced? The following are some tips to help you better understand the benefits of e-filing your taxes:

• It’s easy. You can usually file a state tax return at the same time you electronically file your federal tax return.
• It’s accurate. No more human errors because e-file checks for math errors and necessary information. This not only increases the accuracy of your return, but it also reduces the need for correspondence with the IRS to clarify errors or omissions.
• It’s fast. You don’t have to make a trip to the post office. In fact, you won’t even need to walk to the mailbox to send your return. Just click Send.
• You’ll get your refund faster. When you use e-file, you can get your refund in as little as ten days.
• No more second-guessing yourself. When you file electronically, the computer software or online program guides you through the process step-by-step.
• There are more payment options. With e-file, you can file your return early, but wait to pay any balance due by the April deadline. You can also pay electronically using a credit card, electronic funds withdrawal or in some cases the Electronic Federal Tax Payment System.
• You’ll know the IRS received your return. The IRS will send you an electronic notification acknowledging receipt of your return.
• You’ll have peace of mind. After clicking send and receiving your notification from the IRS that they received your return…kick back and relax – you’re done!

And when it comes to federal tax returns, e-filing makes more sense because you get it done for free. That’s right, you actually don’t have to pay to file your federal tax. Here are a few places to get your free federal filing.

• IRS: If you adjusted gross income is $57,000 or less in 2009, you can choose traditional free file by selecting a free file company. Or you can use free file fillable forms which has no income limit. In case your income is over the limit, you can also find a tax filing company that’s authorized by the IRS for free e-filing.
• TurboTax Free Edition: If you use 1040EZ and have simple tax situation, TrubTax Free Edition lets you file your federal tax for free online. E-filing is also free.
• H&R Block At Home Free: If you don’t have self-employment income (Schedule C), rental and royalty income (Schedule E), farm income (Schedule F) and shareholder/partnership income or loss (Schedule K-1), then you can also use H&RBlock At Home Free with e-filing to file your federal tax.
• TaxAct Free Federal Edition: TaxAct has been offering free federal filing for a long time and unlike TurboTax or H&R Block, there’s no restriction (income or tax situation) on who can use it. Thus, it may be a better option for free federal filing, including free e-filing.

BTW, as you can see, the above free e-filing options don’t include state filing. If you also want to file you state taxes electronically, you will have to pay an additional fee: TurboTax $27.95, H&R Block $29.95, and TaxAct $14.95. TaxAct is again cheaper than the other two.

Are you going to use e-file this year?

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