Is Online Tax Preparation Safe?

Online tax preparation has become an easy alternative in filing your taxes. In fact, there are many taxpayers who opt to prepare and e-file their taxes from home to avoid delay, or because you detest the mail. However, there are also some taxpayers who have questioned the safety of filing online. We assure you though that as long as you know what to do, your data is secure.

Online Tax Preparation: How Safe is It?

What is Online Tax Preparation?

Every year, more and more Americans opt to prepare and file their taxes online. The long lines and wait-time have just become too much. It’s a good thing the internet is here to make our lives easier. Thanks to online tax preparation software and tax filing websites, you can do your taxes from the safety and comfort of your home.

You can prepare and file taxes online by inputting your data into the software of your choice. Then, that software will send your data over to state tax authority or the IRS. Your taxes can be prepared and filed in just a few keystrokes.

Tax Filing Websites and Software

17% growth in number of people filing income tax returns onlinehttps://t.co/EavaxNQJmw pic.twitter.com/qn3ur0eOE1

— Business Standard (@bsindia) November 7, 2017

If you’re interested in trying out online tax preparation this tax season, give these websites and software a try. They’re easy to use and have free versions:

1. H&R Block– File your forms 1040EZ, 1040A, 1040 and Schedule A here with ease. You can also use their mobile app version to take a picture of your W-2 that will become a digital version with all your information already on it. If you want to talk to a real person about your taxes, find the closest H&R office and they’ll entertain your inquiries.
2. TaxSlayer.com– With TaxSlayer.com’s free version, you can file your state return and form 1040EZ. You will also have access to unlimited email and live call support, if you run into any trouble.
3. Turbo Tax– Store and transfer your tax data with this simple software and app. You can use it to file your 1040EZ and 1040A forms. If you’re ever audited, you can count on their customer service to help you out.
4. TaxAct– Easily file and prepare your FAFSAs, 1040EZ, and 1040A using this software. There’s a function where you can import last year’s tax returns and W-2s to your current year. This will lessen your chance of making a mistake. You also get access to free email and call support, and a free mobile app.
5. Free Tax USA– You can prepare and file your file 1040A, 1040EZ, 1040, and federal tax returns on this software. If you’re interested in buying the premium version, it’s one of the most budget-friendly options out there. For only $6.99 you’ll have access to all their features.

The Risks

There are risks that come with the potential rewards of online tax preparation. You need to keep a vigilant watch over your data. Here are the things you should watch out for:

1. Phishing Sites– Make sure the website you’re using is a legitimate one. Phishing sites are designed to look like real tax filing websites. They can install dangerous malware on your computer, or steal valuable information.
2. Unupdated Software– Always make sure to update your software. Older versions are more susceptible to exploits. Make sure to turn on notifications for when you can update your software.
3. Identity Thieves– Skilled hackers could take valuable information from you if you aren’t careful. Make sure to have some sort of identity theft protection. There are sites like Identity Guard and LifeLock that offer such services.

The Benefits

The world of online tax preparation isn’t as scary as you think. Many people file and prepare their taxes this way. They wouldn’t do so if the risks outweighed the benefits. Here are some positives in online tax preparation:

1. Encryption– When something’s encrypted, it can’t be viewed by just anyone. Majority of online tax preparation sites use encryption to keep their clients’ information safe. The data goes straight from the software or website to the IRS or state agency responsible.
2. Fewer Mistakes from Human Error– The software will help you make fewer mistakes. They’ll do all the difficult math for you. You don’t have to worry about miscalculating anything. Also when you file things online, they don’t pass through a human middleman who enters and scans your data. Everything is done by an intelligent program who will most likely make fewer mistakes.
3. Frequent Updates– With preparing and filing taxes traditionally, there’s a huge wait time involved. There will always be long wait lines when you file and prepare in person. With online preparation, you get an update when your refund will be processed and deposited. You also don’t have to wait weeks for snail mail to reach you.

For more online tax preparation and filing software and services, check out this video by The Kim Komando Show:

We shouldn’t fear the integration of technology with our finances. Automation and computers offer us safety and security that is oftentimes difficult to find. Online tax preparation is also easier compared to the traditional way. You can save time and money by doing your taxes online.

How do you prefer to do prepare your taxes? Has this article convinced you to try online tax preparation? Tell us what you think in the comments section below.

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