Tax season can be one of the most stressful and expensive times of the year. You worry over how much money you're going to owe and if you have all your forms in order. Plus, just looking back over all the purchases you made in the past year can add its own type of anxiety. Shelling out big bucks for an accountant is costly, and can still result in mistakes in your tax filings.
Many people shy away from doing their own taxes, primarily due to the lack of understanding surrounding the process. They think you need some special kind of knowledge, which isn't always the case. If you’re willing to do some research and invest time and energy, filing your own taxes is a great way to save money.
Why you should file your own taxes
Filing your own taxes isn't as hard as it seems. Thanks to the internet, there are countless tools and resources to help make the tax filing process more manageable than ever. While it might be more time consuming, you can also save tons of money and increase your financial knowledge.
You might be asking a few questions about the process, such as: “What do I need to file my own taxes?” “What steps do I take when filing my own taxes?” “What tools and resources should I use to complete my tax returns?” Let’s dive into everything you need to know about the tax filing process while considering the best ways to keep costs low.
How to file your own taxes and what you’ll need to complete the process
Although filing your own taxes might seem scary if you've never done it before, organization and resourcefulness will go a long way in keeping you on track.
- Determine if you need to file taxes. Some people, such as workers making under a certain amount, aren’t required to file.
- Gather all of the necessary documents. These include W2 forms from each employer, 1099 and 1099-INT forms, mortgage interest statements, and receipts for business expenses and charitable donations.
- Choose how you'll file. You can do this by hand, but many people choose tax filing software instead. Using the right software can help you greatly throughout this process, both preventing mistakes and keeping costs low.
- Review any recent life changes. If you've experienced a change in marital status, address, or job/income, these will affect the filing process and may necessitate the completion of documents such as the 8822 or SS-5 forms.
- Do your research. Determine which deductions you can take in order to ensure you’re utilizing all potential options. Completing this step strategically is the best way to save money. Opt for either a standard or itemized deduction(s), whichever is more financially expedient.
- Review. It's important to look over the returns and check them closely for errors that could cost you.
Useful tax software
Opting for a user-friendly and cost-effective tax software program is the best way to ensure accuracy while preventing high accountant costs. These computer programs streamline the at-home tax preparation process and are widely utilized by thousands of Americans to save cash every tax season:
- H&R Block: Offers a free software which is great for straightforward tax returns. This plan is an incredible option for those with simple financial situations. H&R Block also provides additional resources such as H&R Block tax classes and virtual tax assistance from experts.
- TurboTax: While its costs aren’t the lowest of these options, TurboTax is lauded for its user-friendly, streamlined systems. TurboTax for business and TurboTax premier are great options that include investment reporting and home deductions. Although plans start at $0 for the basic options, TurboTax alternatives are likely cheaper.
- TaxAct: Provides a robust program at a low price point, offering TaxAct professional advice and reviews at every tier. Users also enjoy benefits like TaxAct free file and the TaxAct guarantee of 100% accuracy.
- Taxslayer: Has an amazing budget option featuring a less-refined user interface. Taxslayer center is a bit harder to use than competitors’ software, but it offers useful resources like the Taxslayer calculator.
Each software provider offers different tiers and packages, as well as many opportunities to save through free resources, accuracy in the deductions process, and advice from experts.
Regardless of which tax-filing option you decide to go with, Mulberry is here to help you make the most informed purchasing decisions. Shop with the Mulberry browser extension to browse extended warranty plans.
