Monday, February 28, 2011

Tax Prep Help

Even though you may not have received mail from your favorite uncle this year, he is expecting you to send your annual contribution to his bank account no later than April 18th. In recognition of the fact that many of us don’t use the printed tax forms that have traditionally been mailed to all wage earners, the IRS is saving money and not sending them unless requested. More and more of us either use professional tax preparers or have embraced computer software. There are several options and some of them are actually free.

The two most widely used commercially available tax preparation software packages are TurboTax from Intuit and TaxCut from H&R Block. I have used both and find them almost identical in function and ease of use. Both come in various “flavors” from versions that assist in preparing simple returns to versions that walk you though filing for a small business or a Chapter S corporation. Most include a module for filing state returns as well. Be sure to get a version that allows free E-filing for both federal and state returns.

Be prepared to spend from $50 to $100 for the software. The more features and more complex the return, the higher the price. Office supply stores like Staples and OfficeMax stock the products and, of course, you can get them on line and download a copy directly to your computer.

There are several other options available on line. Some are free and others very inexpensive. With so many offers on the web you must shop carefully. A Google search will provide hundreds of “official” IRS Tax Assistance Sites. Closer scrutiny will show that most have no relation to the IRS. Look for web sites that have a “.gov” suffix on the web address rather that a “.com” as the latter indicates a for-profit company.

If your income is $58,000 or less, the IRS has some free software that might be good to check out. It is called Free File. It's available only through IRS.gov. Some 20 tax software companies have made their products available for free. Some also support state tax returns for free. Since the IRS has checked these offers out, you can feel safe using them. You will find the software offer at www.IRS.gov.

There is no paucity of companies and services that want to do you taxes. I have seen ads on TV for car dealerships offering to do your taxes if you use your tax refund to buy a car. Furniture stores, too, will be happy to help you get your refund faster if you will spend it with them. If you shop wisely, you will find lots of good tools on the web. They might not make filing your return enjoyable, but they will make it less of a hassle.

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