Taxes; Should you do them yourself?

It’s that time of year again, time to pay up what you owe to Uncle Sam.  The big question is “should I do my own taxes?”  And my answer is “well, that depends.”  If you are single and have no deductions with the exception of perhaps school loans you can do you own taxes pretty quickly and easily right on-line using the free version of TurboTax, H&R block’s software or TaxAct. Only these three are friendly enough to do yourself without too much prior experience in doing your taxes  I did my youngest daughters taxes, it took about half an hour and in two or three weeks she had her money! If you are like my husband and I you should think hard about doing your own taxes.  We have deductions like mortgage interest etc.  Up until recently, I had a small business as well and all of that has to be done as well with schedule C’s, profit and loss statements and the rest.  I still did my taxes myself using Turbo Tax even with all of these things and saved a boat load of money, about $225.00 to be exact. The thing is while it’s not hard it’s not easy either.  I’m pretty savvy with a computer and I’ve kept my business records on Quick Books so getting the information I needed to do the taxes was not all that difficult FOR ME.

New this year that I just heard about and have NOT used is Free File through the IRS. https://www.irs.gov/uac/free-file-do-your-federal-taxes-for-free  this seems like a great way to do your taxes without paying anything at all.  There seem to be some pretty robust directions on how to use the system and some great information about the Health Care Law and your taxes as what you will need to get started, including what is required of your computer system to make it all work correctly.

Free tax preparation is available through the Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE) sites in many communities. Taxpayers should check community newspapers for VITA site locations or call 1-800-906-9887 for more information. Taxpayers may also call AARP — the largest TCE participant — at 1-888-227-7669 to find the most convenient location.

IRS Taxpayer Assistance Centers are a source of personal tax help when taxpayers believe their tax issues cannot be handled on-line or by phone, and they want face-to-face assistance. IRS representatives in these offices can help with inquiries, adjustments, letters and notices and payment plans for those who owe tax and cannot pay the full amount. Locations are posted on IRS.gov under the “Individuals” tab. Just click the link Contact My Local Office or type “Contact My Local Office” in the search box on IRS.gov to find availability by state. Also, taxpayers can hear a recorded message detailing office hours and addresses by calling the number listed in their local phone directory.

And one more thing if you are getting a whole bunch of money back every year you might want to think about changing how much comes out of your check every week.  I know it’s nice to have a big chunk of money every year but you could cut down that big return by half and keep it in your weekly paycheck instead.  I never want to have to pay in but I don’t want to give Uncle Sam my money to hold for a year either. Try going to the  IRS Withholding Calculator, which helps taxpayers make sure the amount of income tax they have withheld from their pay isn’t too high or too low.

And don’t forget by law, the IRS must hold refunds claiming the Earned Income Tax Credit and/or the Additional Child Tax Credit until February 15.

Tax fraud has become big business, be sure to protect your social security number at all costs. NO ONE should ever ask you for your entire social security number over the phone and the IRS certainly never does.  It is best to file early to avoid someone else doing it for you. The IRS is working hard to protect you from tax fraud, they rolled out some security measures for this tax season.

IRS Commissioner John Koskinen said in a press briefing.  “What will be different is that the software makers will share information with the IRS and state revenue departments that will let them see, among other things, whether the return was filed from a “trusted” computer and Internet address, as well as the time it took to complete the return so mechanized fraud can be detected.”

Best of luck with your taxes!!

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2 Comments Add yours

  1. Great resources here for those who need a running start!

    As an accountant, I do believe that doing your own taxes is okay if you are only reporting the basics, however, I have seen many businesses miss important deductions that could have saved them substantial money. Tax software has improved greatly, but it should never be a replacement for a qualified CPA.

    1. Absolutely agree! There is no reason you cannot do your own taxes if you have a simple return. Once you have a house, children or running a small business it is best to consult with a professional.

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