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Advice for Free Online Tax E-File

 

Advice for Free Online Tax E-File

Roxanna Guinan
by Roxanna Guinan, Contributor

If you are planning to e-file taxes online for free, you’ll need to get your records in order so that the process goes smoothly.  Typically, you’ll need records of all income for yourself and your spouse if filing jointly ? including W-2 tax forms, 1099 DIV/INT/OIDs for dividend and interest payments received, alimony payments, rental property income, royalties, etc.

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To e-file taxes online for free, you will also need to have records of any tax deductions or tax credits for which you may be eligible ? including contributions to IRA or other retirement plan accounts, tuition payments, childcare expenses, real estate taxes, charitable contributions, medical expenses, business expenses, etc. These figures are necessary in order to compute your adjusted gross income (AGI) for income tax purposes.

All this information will be required when you e-file taxes online for free.

AGI is defined as your “taxable income” from all sources (including wages, salaries, tips, taxable interest, ordinary dividends, taxable refunds, credits, or offsets of state and local income taxes, alimony received, business income or loss, capital gains or losses, other gains or losses, taxable IRA distributions, taxable pensions and annuities, rental real estate, royalties, farm income or losses, unemployment compensation, taxable social security benefits, and other income (minus specific deductions, including educator expenses), the IRA deduction, student loan interest deduction, tuition and fees deduction, Archer MSA deduction, moving expenses, one-half of self-employment tax, self-employed health insurance deduction, self-employed SEP, SIMPLE, and qualified plans, penalty on early withdrawal of savings, and alimony paid by you. Do not deduct your standard or itemized deductions.

As you look for a software provider to help you e-file taxes online for free, consider using a company recommended by the IRS. Most tax preparation programs follow the order of the standard IRS tax forms (the 1040 series, including 1040EZ and 1040A) and provide guidance and prompts to avoid confusion and to make the process of e-filing taxes online for free as smooth as possible.