Tuesday, January 21, 2014

Free and Low Cost Tax Filing Options

Isn't it bad enough that we have to file a tax return in the first place, but it has become so complicated we need software to file many types of returns and generally have to pay for it? I'm really not complaining, but it does seem it has become more complicated and more costly.

First of all, if you income is below $58,000 per year you actually shouldn't be paying anything in order to file your taxes. The IRS has offered Free File in the past and is doing so again this year. The best way to find the free programs you are eligible for is to link directly to the IRS and click on the Free File tab. Or here is the link where that tab will take you. You definitely get to e-file your Federal return for free. It could be a different story based on your state, so look over your options closely before you get started.

If you are military, there are often options available specifically for you that may be entirely free. There may be some caveat that you need to have served in a combat zone, so make sure the free option really applies. If you aren't military, it is good to consider if your bank, professional organization, church or community offers a service for free preparation and filing. Do your homework...google lots of possibilities!

For those of us with incomes over $58,000 per year, there are still relatively inexpensive ways to prepare and file your income tax returns. Most of them are online services. In fact, I would completely avoid any in package software discs you might find in the store, unless you do not have internet access or the software comes with a rebate lending the software free! I have used TurboTax, TaxAct, HRBlock, and several other services. I know some people don't like to switch because last years information is often imported if you use the same service. I personally am happy to switch if I can get the service free or cheap. It doesn't take much time at all to input the information again.

Last year I was tipped off about another service called FreeTaxUSA (I don't get any referral bonus for saying this). The charge was free to complete and efile the federal return, and just $9.99 for the state. This year the Federal return is still free, but the state return is now $12.95. This is a very good price, but you can get it lower! If you use a coupon site, check to see if there is a coupon that will reduce the price you pay for this or tax service you end up using. I happen to know that Ebates has a coupon for 25% off FreeTaxUSA, with coupon code FREETAXUSA25, good all the way until November 1, 2014 (yes, even available for you late filers!). And if you connect through your Ebates account, you can also get 25% cash back. If I did my math right this brings your final cost after the rebate to $7.28. That is pretty good if you want the software and ability to efile your return. If you don't have an Ebates account, you can sign up here.

Right now I plan to use FreeTaxUSA, unless I find a better deal. If I do, I'll let you know!

Do your homework.  Look around for the least expensive way to do your taxes that you feel comfortable with! Do you have any other good tax preparation services to share with others? Please leave them in the comments for others to check out.

1 comment:

  1. I second what CreditCardFree is saying here. :)
    FreeTaxUSA has been great for me for many years.


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