Tax Preparation- Ask Expert Phillip Thow: Is E-Filing Worth It?

Every year, more and more people do their taxes online. There are many reasons why people seek online tax preparation, from ease of use to convenience and even for speedier returns. Surprisingly, some states don’t allow online tax submission, so according to Phillip Thow, the first rule to choosing this method is to make sure that it’s available in your state. If it is, and you decide to e-file your taxes, take some time to learn about what it can do for you.

Every year, the IRS website offers a free list of e-filing resources for individuals at income tax time. The list contains between 20 and 30 different websites that offer tax preparation, and includes everything from H&R Block to sites that most people have never heard of. The common denominator of all of these sites is that they offer one thing: free e-filing. This is a big deal, because tax forms that once cost a stamp to send in can cost upwards of $30 to submit online in some places, according to Phillip Thow. No matter how convenient or simple the online process is, people don’t usually want to pay that much to use it.

So is e-filing really worth the effort, and the potential investment? If you ask Phillip Thow, considering that even most of the ‘free file’ sites charge at least $8 to do your state returns for you in addition to the federal return, the choice will be yours to make. For some, it’s a great investment because it’s easier and they get money back sooner. For others, it’s a hassle and an expense that they can’t afford when filling out the paper form isn’t that complicated. If you are pressed for time and have a complicated tax return to file, e-filing services can be a great benefit. However, if you’re filling out the 1040EZ, you can probably do it just as fast as the computer does, and save yourself any potential expenses of online filing according to Phillip Thow.

With e-filing, most returns are processed in the same amount of time as mailed returns. The only reason that it seems that you get the money faster, according to Phillip Thow, is because you’re not mailing your forms in. Electronic submission only takes a couple of days, while mailing your forms could take up to a week to get them to where they’re going. For convenience and easy preparation, online services are great for tax preparation, but they aren’t right for everyone. Phillip Thow will tell you that it’s your choice to make in the end, so do whatever is best for your needs.

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