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If your tax return is relatively simple, using a free online tax filing service will save you hundreds of dollars over utilizing an accountant. Today, the software is automated in a way even a non-financially savvy individual can file taxes without confusion. Many services offer a thorough check of your filing before you submit, making the process even more certain and convenient.
Is Online Filing Right for Me?
Online filing is best if you have less than three income sources to file and are receiving detailed forms, such as a W2, W4 or 1099. These forms do a lot of the work for you in determining how much you have already paid. For those people who are self-employed, have more than 3 income sources, or are running nonprofit organizations, online filing may not be sufficient to address your specific needs.
Can I File Federal and State Taxes?
Most online services have both a state and federal tax option. You will typically file each separately and save the results independently. There should be a monitor that allows you to see the status of both returns to know when they have been accepted by the respective bureau. The process for filing state and federal taxes is relatively similar, though the tax rates will generally be different. If you have lived in more than one state over the course of the year, you will need to file each state independently. Most online services have an option for this and walk you directly through the steps.
Which Free Services Are Best?
The first option to consider for filing your free online tax preparation is the Federal e-File. This is a service provided directly from the IRS, so most people feel comfortable using this service. TurboTax, the popular tax software, also has a free online version for more simple returns. If you are filing a more complicated tax return, you may need to opt for the paid version of TurboTax. H&R Block offers a free online tax calculator for you to estimate your yearly amount owed or refund. They also have an online filing option, but this is a paid service that is then reviewed by an accountant.
How Do I Pay or Get My Return?
One of the best things about the free online filing services are that they offer a direct deposit option. This means you can enter your bank account information to receive your return, or pay the balance, directly. This will expedite the time it takes to completely finalize your yearly taxes. You can also opt to send a check.
What If I Get Audited?
You should print your filings to keep detailed records. You will also get email alerts letting you know when you taxes have been officially filed and when they have been accepted. Printing and keeping these for your records is the safest way to protect yourself in case of audit. You should also make copies of any receipts for deductions and keep these with your filing records.
