IRS 2012 tax season opened up on January 17 and income tax preparation is now a priority. But at the very least you can save on the substantial cost of getting your return done for you. You can e-file your own income tax return free if you’re one of the taxpayers who qualify (most do). If you don’t qualify, there are other ways you can reduce your costs.
If your adjusted gross earnings (AGI) in 2011 was $57,000 or less, then you qualify to use the IRS free file mini-site. This is a free tax preparation and digital filing site for those taxpayers who fall under the AGI limit which was developed by a partnership among the Internal Revenue Service and tax software package companies. If you qualify, you can find a free file organization thru the Internal Revenue Service.
If your AGI is above the limit, you can nonetheless file your tax return free thru on the web tax preparation companies – but you will have to pay to file your state tax return. So you need to consider how much filing your state tax return will cost. Of training course, this isn’t a problem for those who live in a state with very low or no state taxes.
You can also use a Free File Fillable Form to do your filing. This is like a paper tax return but you can fill it in on the web and file it free of charge, You do need to be able to prepare your own return, but you can use the free on-line tax estimation software package and transfer the information and you should have preceding tax returns as a guide, especially if very Minor has changed. However, this also does not include your state tax return.
If your tax situation is complex, you can possibly justify the cost and might be safer with a tax preparer who is familiar with your particular situation and who has verified reliability. But you could try negotiating a lower price. Otherwise an on the net lookup will turn up various different companies whose expenses may vary considerably. Again, these prices are based on an ordinary tax situation; anything more complex will attract extra costs.
You should also consider the qualifications and experience of the tax preparer and not just go for the lowest prices. Remember, you could be lured in by low marketed prices but could find on your own paying further for services which would normally be included. Make sure up front exactly what will be included in the fee. Remember, you could find your self paying a lot more in tax than the income you save by using an inferior tax prepare who makes a mistake with your income tax return.
Whatever you do, don’t go for a federal tax refund anticipation loan, as you will get your refund very speedily (usually within a week or two) thru e-submitting anyway if you elect to have the tax refund directly deposited to your account, and these are expensive options.
All in all, doing your taxes is not a task anyone actually looks forward to. But if you are prepared and keep on top of it, you can pay very Small or even get your tax preparation free, and this makes the effort worthwhile,