Filing your taxes has never been so easy; nobody likes it but we all have to report our income and to pay our taxes. It is still possible to file your taxes manually for people who never used a computer or don’t feel comfortable with the new technology. Filing taxes online has more benefits than the system of the past where you have to write it all down on paper and you might need an accountant to understand all the different codes.
If you file taxes online you never need to search the question about a return of previous year because the system knows it automatically. You save a lot of time and your information will be accurate. Do you know how much time you spend in searching into your papers of previous year? It’s possible you can’t find it anymore. This danger doesn’t exist if you file online. That being said, you still need to know the laws if you can enjoy some tax deductions, for example home mortgage interest, retirement plans, charity expenses, etc.
How to file your taxes online varies from country to country and you need to know which software to use in the country in which you live. Some countries allow only an online version of their Government but others allow different software which is compatible with the rules of their government. In the US it is possible you can use a free version but the paid version will give you more hints for tax deductions you may not know.
The two most popular programs in America to file your taxes are IRS-E File and Turbotax. Turbotax is the most popular one and it is not difficult to understand why. This program is user friendly and offers tools for their users to get the most deductions. Most online filing programs offer a free version but you need to qualify for them. Paid versions are certainly helpful if they can deduct expenses which lower your taxes, for example if you own a home, investment instruments like stocks, bonds or mutual funds.
It is important to check the requirements but they ask you some questions and you know immediately if you qualify or not. If you use the IRS-E File program you can use the free version if your gross income is below a certain amount which varies from year to year. If you don’t qualify for the free version of this program, it is still possible you may qualify for the free version of Turbotax or some other online tax programs.
Filing your taxes online is really easy. Here are some steps which you need to follow for filing your taxes online:
1. Choose the software you like to use, for example IRS or Turbotax. Some people may prefer IRS but often Turbotax has more options which make it easier for you to find the right option for you. A free version can be good but you need to qualify and maybe you prefer a more advanced version which gives more tools and hints for deductions which may help you to reduce your taxes.
2. Start creating an account if it is the first time you are filing your taxes online. The program will ask your email address, User ID and you need to accept the license agreement.
3. If you use IRS you need to choose if you are an individual or a business.
4. File your personal information.
5. File your family information, for example how many children you have, information about your home (do you own one or do you rent), job status, details about your education.
6. Report all your sources of income.
7. Report all the deductions which may help to reduce your taxes.
8. Click Finish and you get a review of all the information you filled in and a calculation of the taxes you have to pay or if you have a refund. They also give some indications how you can reduce your taxes.
9. Click Print and file (be sure that you didn’t forget your social security number).
Once you have filed your taxes you will receive a confirmation page with a confirmation number in your email box and you are sure they have received your information.
Filing your taxes online will ease your work but you still need some preparation before you can start and it is really important that you have all the necessary documents before you start. Once you have tried to file your taxes online you will never regret to have chosen for this system; it can even save the expenses for hiring an account.