Filing Your Own Taxes - Comparing Tax Software
It is tax time again and it will either make you cringe if you owe money or rejoice if you don't. For many people it is a time filled with dread at trying to figure out their taxes. Another option is to take your return to a tax preparation site and pay up to hundreds of dollars for someone else to file for you. I have to say that with all the tax software on the market it is just not that hard to file your own taxes.
Tax software such as Turbo Tax, TaxCut and TaxAct all walk you through step by step making it incredibly easy to file your own - for a fraction of the cost of paying someone else. If you will be getting a refund, using this online software will also get you your refund much quicker than if you were to mail your forms in - usually within two weeks of filing.
Let's take a look at each option. Turbo Tax has been my personal favorite. I find it very easy to use. If you have a very simple return and will be filing a 1040 EZ Turbo Tax allows you to file your federal taxes free. If you have a more complicated return, for example if you own your home or have dependents, you will need to file the Deluxe edition which costs $29.95. The Deluxe edition will help you maximize your deductions to get you the most money back or minimize how much you owe. Turbo Tax has other options for even more complicated returns. Their website will help you choose. You can start your return for free and pay when you file.
TaxCut is the online software that H&R Block offers. Many people like having this tax company backing them up against the IRS. A basic, simple return costs $14.95 to file the federal. The Premium software for more complicated returns costs $19.95. Looking at the website, I am considering switching to this software this year. The Premium + State package is $44.95 and covers the filing of your federal and state returns. This is a large jump in price to include the state filing. The TaxCut software offers Audit Support which will help you if you are audited. Basically they will give you information on what to say to the IRS if they are asking questions. Both the Premium and Premium + State versions come with one session to ask a tax advisor questions. This is a very appealing benefit of TaxCut.
TaxAct claims to be totally free for anyone filing a federal return. To file a state return it will cost $13.95. I have looked and looked trying to find a catch to this free service but I can't seem to find one. They offer support if you have questions or get confused. If you end up having to pay a penalty due to an error by them, they will pay the penalty. TaxAct has no software to download, you fill out the forms on their site. This is a bit different than the previous two options.
There are other websites out there that might allow you to file free through them. Free Tax USA allows people that live in certain states and have an adjusted gross income of $54,000 or less to file for free. The website states that if you don't qualify for the free filing it will only cost you $9.95 to file. This site seems to have the lowest price on filing a state return - $9.95. However you need to look into filing a state return yourself. Last year I went through the Ohio state tax website and was able to file my state taxes for free, though all of the other software wanted between $10 and $15 to file it.
Doing a quick Google search turned up thousands of options for filing your taxes. Be careful with which site you choose to go through. Make sure it is a secure site and read reviews of the sites to help you determine the best ones. You want to make sure that everything is filed correctly and that you have someone backing you up if you do get audited.
I know many people just want to hand off the paperwork to someone else and then not worry about it, but gathering the paperwork is half of the process. Once you have it all together it is super easy to enter the information. This year consider filing your own taxes and saving money in the process.