Preparing Your Taxes Doesn’t Have to Be Difficult!
There are many different ways to prepare your income tax return. Whether you hire a professional or do it yourself, tax preparation can be relatively easy and stress-free if you understand the basics of the process and your options.
Gather the appropriate documents. Preparing a tax return is much less stressful when you are organized and have all the proper paperwork laid out in front of you. In general, this includes income statements (W-2 and 1099 tax forms) as well as receipts for tax deductions and contributions.
Decide which filing method is best for you. You typically have 3 tax filing options: paper filing, tax preparation software, or hiring a professional.
Even in today’s day and age of digital technology, many people still feel more secure preparing taxes with good old pen and paper. With paper filing, you are in charge of every detail from start to finish – but there is no immediate tax help available. After you fill out your tax return (Form 1040 or Form 1040-SR), you will need to mail it to the appropriate IRS address. Your tax return must be postmarked by the filing deadline (typically April 15th) in order to be considered “on time.”
Tax Preparation Software
Tax preparation software is becoming more and more popular for many reasons. Most tax preparation programs will be able to answer any questions you may have. Additionally, much of the software is built to help you take advantage of as many tax deductions and tax credits as possible. Most tax prep websites allow you to fill out, print, and e-file your federal tax return all from the comfort of your computer. Make sure you use a reputable company before you share any personal information online.
When you hire a professional to prepare your income tax return, you are generally cutting out all of the “guesswork.” You can be confident that your tax return is accurate and that you are saving as much money as possible. The downside to this is that you will pass the control to the tax professional, and of course, you have to pay for this tax preparation service. Make sure you use a reputable company to avoid potential filing issues and/or identity theft.
Traditional Mail vs. Online Filing
Those who are filing a paper tax return will need to mail it to the IRS upon completion. On the other hand, if you are using tax preparation software or filing through a tax professional, electronic filing may be a better option for you. Tax returns that are submitted electronically are processed much faster, which means you can get a faster tax refund.
No matter what option you choose to prepare your taxes, these things remain the same: you need to be organized, have the proper documents on hand, and be careful who you share your personal information with.