Taxes seems to be a dreaded feat this time of year, but they don’t have to be! If you are sitting there asking yourself, “When are taxes due?”, the big day this year is April 18th. Don’t panic, you have plenty of time to figure out what you are doing. My goal is to show you how quick and easy it can be to file your taxes right from your own home, without having it cost an arm and a leg. That way you will have more money to pair with your tax return to plan that big trip you’ve been waiting to go on or pay off some debt. Time is precious so let's get you started:
Getting Your Taxes Filed Early
I know that you probably have 100 other things you would rather do than sit down and file your taxes. I used to be the same way until I experienced the massive relief of getting them done early; now I can’t imagine waiting until the last minute. I still file fairly simple returns, but even just starting paperwork early will benefit the most complex of returns. Still not convinced? Check out some the biggest perks of being an early bird this year:
- Faster Refunds: The only good thing that comes out of filing your taxes is getting money back once you’ve completed them. Unfortunately some people do end up owing money, but hopefully you aren’t one of them! The earlier you file, the sooner your refund will get processed. If you file in April, the IRS will likely be backed up and you will have to wait much longer to get your refund.
- More Time to Pay Owed Taxes: If you do fall into the group that owes money back to the IRS, filing early will give you more time to pay what you owe. You have until April 18th, so the earlier you file, the more time you have to save up to pay off that bill.
- Financial Paperwork: Filing early (or at the very least getting paperwork started) gives you a head start on other paperwork for stuff like financial aid and homeowners applications. Cross more off your to-do list by working on everything together!
- Avoiding Extension Request: Typically you need to file an extension when you aren’t prepared and are rushing in April, arguably not always the case. Starting early will alert you to any problems that might need to be addressed before you can file, giving you time to fix them on time.
- Preventing Identity Theft: Filing your taxes first means that there is less of a chance of someone claiming to be you and trying to file taxes using your name. You might think that is is farfetched but better to be safe than sorry.
How Do I File My Taxes?
Now that you know why it’s smart to at least start preparing your taxes early, you need to actually put that into action. There are a lot of pros to working with a tax accountant, but they often come at a steep cost to you. On the flip side, filing online can be just as easy and will cost you significantly less. Do some research, ask family and friends how they have filed in the past, and then decide what works best for you. If you do decide to file online, here our some of our favorite tax software tools:
- TurboTax is one of the most well known and highly regarded tax tools out there. In addition to having a free option, yes you read that correctly- completely FREE, TurboTax also offers Deluxe, Premier, and Home & Business programs to suit the needs of all of their clients and maximize their returns. They also offer premium heads-up audit detection and a plethora of deduction options. Now get 20% off TurboTax Online.
- H&R Block is another highly reliable software and reputable company. In addition to comprehensive online services, they also have stores that allow walk-ins to talk to tax professionals. While working online, you have access to tools, like the H&R Block tax calculator, for even your most complex of tax needs and amazing customer support from start to finish, if you need it. They will give you the confidence you need while filing online. File online with this 20% off Online Products H&R Block coupon.
- TaxAct may not be as well known as TurboTax and H&R Block, but they are definitely in the competition to win. They offer a big bang for your buck and are a great option for the simple filers looking for free tax filing. With mini-alerts that identify errors throughout and access to learning resources, they make figuring how to file your taxes easy and fast. Plus they have a built-in spreadsheet that makes recording information a breeze. If you have a more complex return, they might not have all of the features you need, so it would be helpful to compare with other software options. Save more with this TaxAct Ultimate Bundle deal for 40% off on Federal and State Tax Filing.
How Can You Get Deductions While Filing Taxes?
Now that you have decided to file early and chosen your tax software, it is good to be aware of some deductions that you could be eligible for. Check the IRS site for a complete list of tax deductions and credits, but here are a few of the most common:
- Student Loans: Whether you are paying your loans (or your parents), you can deduct the interest you pay on your loans each year up to $2,500 as long as the loan is in your name.
- Job Searching: Looking for a job can add up quickly, and if it exceeds 2% off your gross income is could be eligible for deduction.
- Continuing Higher Education: If you are continuing your education with graduate or professional degree courses, you can apply for the Lifetime Learning Credit. This gives you a $2,000 credit towards those costs and there is no limit to how many years you can take advantage of the credit. You just have to make less than $52,000.
- Charitable Donations: Although more difficult to get deductions on, unless you are donating large amounts of money, you can submit your charitable contributions from the previous year, whether you donated items, money, time, etc.
- Contract/Freelance Work: Working from a home office can qualify you for further deductions on costs such as phone, Internet, and other office costs. In addition, if you use your personal car for business travel, there are deductions available. It is important to keep record of all expenses to distinguish personal and business use come time to submit costs with your return. Just make sure to do your research before filing so you are aware of any write-offs available to you.
Now that you have the steps, tools, and some common tax deductions, it is time to file your taxes! Then just sit back and wait for that glorious return to hit your bank account and dream of what you will do with your newfound wealth. Happy tax season!