You trudge home from work one evening in late-January, weary from the day, and looking forward to the newest issue of your favorite magazine. This little treasure should be awaiting your arrival, nestled safely inside your mailbox. Indeed, you happily discover it upon checking your box, and purely out of a sense of duty, you lug the rest of the contents inside, as well.
Once inside, after sifting through the pile of junk mail and credit card offers, you see it. The name of the company you work for up in the top left corner of the business-sized envelope. You get direct deposit, and your insurance enrollment papers came already this year. There is only one thing it could possibly be; a document so powerful it can at once induce a sense of both dread and excitement. It is, of course, your W2.
One Piece of Paper, So Much Potential
Many young people are quite apprehensive when it comes to handling this double-edged document themselves. As much promise as this one piece of paper holds, it can be intimidating for young people to figure out what it all means, and quite simply, where all the numbers go. And so, once a year, otherwise capable, self-sufficient young adults are seemingly satisfied to spend their hard-earned money by having a tax prep service handle the matter, and still others just beg their parents for help.
Well, no more! You, too, can prepare your own taxes. And don’t worry…if the Secretary of the Treasury can expect people to believe he didn’t understand that he had to pay taxes, chances are, any small mistakes you make will be either overlooked, or easily remedied.
When doing your own taxes, you must ensure you can back up whatever you claim as a deduction on your tax liability. When you itemize things for your tax returns, you must be honest, or it could come back to haunt you down the road. Receipts are very important for anything you will be claiming on your taxes. Try to gather all of your information before you begin, and the process will go that much faster.
Where Can I File If I Prepare My Taxes Myself?
Filing online can be a real timesaver. One very reputable site for free E-Filing with the IRS is www.taxact.com. This site walks you through each step in the tax-filing process, guiding you and formatting each page of questions in a simple to use interface. Assuming you have average tax documents that consist of little more than one W2 for each employer you have, any mortgage statements, itemized deductions and any bank or insurance dividends, filing online shouldn’t take you more than an hour. If you have a spouse and will file jointly, allow a bit more time to input their expenses and income information, as well.
To file your state returns online, there is usually a fee of around $10. This is unavoidable if you file online without using purchased, licensed tax prep software. In the long run, I have found this to be the best way to file my taxes, even with a small fee to do my state portion.
Where Can I Have Someone Do My Taxes For Me?
If you are not in any way inclined to attempt your own tax preparation, there are many places that will happily provide this service. This process takes at least as long as doing them yourself, usually longer because a third party has to relay all of the information. Preparing your own taxes spares you the middleman, and the fee. Typical services at H&R Block or similar service providers will run you from $150, up to $300 for standard tax preparation and filing services.
Let me say, I have gone this route. I found the entire experience not unlike flicking myself, repeatedly, on the wrist with a rubber band: not necessarily painful, but after awhile it gets pretty flippin’ irritating. After an hour and a half of repeatedly being asked your last name and Social Security number, and watching them type your answers at a rate of three and a half words per minute, you’ll be begging to pay them anything they ask just to let you leave and be done with it all.
Preparing your own taxes is something almost anyone can do, especially if you have access to the internet. Simply gather your documents, find out pertinent information (does anyone claim you as a dependent on their taxes, do you qualify for any credits, is there more benefit to filing separately than jointly with a spouse, etc), and use free, internet-based software to get your filing underway. It’s practically free, takes less time than going to a professional prep service, and you have the satisfaction of having done it yourself!
Now, if only it were so easy to decide what to do with that tax refund...