Preparing a tax return using software is affordable, compared to hiring a return preparer. Even still, return filers need to know how dependable software is and which ones they can trust to help accurately prepare their tax return.
IRS Free File Alliance
Since 2003, more than 46 million people have used Free File. If your adjusted gross income for 2015 was $62,000 or less, you may use free return preparation software. The alliance between the IRS and the tax industry was formed to provide free return preparation to taxpayers with lower income.
There are 13 brand name software to choose from, including TurboTax, 1040NOW.NET, Online Taxes at OLT.com, TaxACT, and TaxSlayer. Each software offers a variety of services. For 2016, more Free File software providers are offering both federal and state tax return preparation. However, not all providers offer state return preparation for free.
“You don’t have to be an expert on taxes. Free File software can help walk you through the steps and help you get it right,” said John A. Koskinen, IRS Commissioner.
Choosing the Software
When choosing the appropriate software for your needs, you may use the IRS tool ‘Help Me Find Free File Software’. Answering simple questions about your adjusted gross income, age, state residency, eligibility for the Earned Income Tax Credit, and military status can help you determine which software to use.
Tim Hugo, executive director of the Free File Alliance, said, “We are proud to once again offer the industry’s most innovative and secure tax software at no cost to 70 percent of American taxpayers.”
Any taxpayer, regardless of their income or other factors, can electronically his or her file tax return for free using IRS efile. An added benefit of efiling a return is a faster refund.
Paid Tax Software
If you earn more than $62,000, are self-employed, or receive income from freelancing, you may need to use paid software.
Paid software may offer the service to import W2 information. However, taxpayers should review the information carefully to ensure the information entered is accurate and without error. Regardless of the software type you’re using, it is wise to double-check the information you’re sending.
If your taxes are complicated and you need specific questions answered, it is preferable to hire a professional return preparer. To find one in your area, you may use the IRS Directory of Federal Tax Return Preparers available on irs.gov.