One certainty in life: Taxes
One uncertainty in life: What’s the best tax preparation software?
So at some unfortunate point in my life, I grew up and outgrew the 1040EZ. Eventually, I picked up enough forethought to put some time into researching tax preparation software, hoping to find a suitable product at the right price. These days, I start my research in the FatWallet Forums, and from there I’ll find additional Internet resources. Hopefully, some of the information and resources I’ve found will help to get you started in time to take advantage of tax software deals while they’re still available…
Tax Preparation Options
Selecting the right tax prep option depends on your own needs and preferences. You’ll find basic to deluxe desktop and online versions to prepare and e-file your federal and state returns.
Basic to Deluxe
If your taxes are simple enough that you’re considering a “basic” version software, look into the IRS Free File program:
“The Free File program provides free federal income tax preparation and electronic filing for eligible taxpayers through a partnership between the Internal Revenue Service (IRS) and the Free File Alliance LLC, a group of private sector tax software companies.” (IRS Free File)
If your adjusted gross income is $56K or less, this online program allows you to take advantage of a handful of popular tax prep products, like TurboTax and TaxCut (now H&R Block At Home) for free. You’ll pay an additional fee for your state file, still a bargain after skipping the $20 to $75 cost of the tax preparation software.
Otherwise, basic tax preparation software is usually a good value only if you don’t have state returns to prepare and file as each state return is an additional cost on these basic packages. Deluxe packages usually cover federal and at least one state file for more than one taxpayer, as well as guidance through more complex preparations that involve multiple incomes, income property, and capital gains and losses.
Desktop vs. Web
While online versions offer web-based convenience and may cost a little less, desktop software works quickly from your hard drive, avoiding the lag of a web-based application. Also, the software package is always accessible should a question arise, or as a reference for next year’s return.
Tax Preparation Software Deals
The rumblings we’re hearing from our Tax Software merchants: Don’t wait until March or April to buy your software. By that time, they’re counting on your urgency taking priority over the bottom line. So now is the time to find deals on the best tax preparation software, and here are a few threads and custom views from the Hot Deals Forum to get you started:
Keep an eye on Hot Deals tax software by subscribing to a Tax Software View Alert
The FatWallet Finance Forum
Incase you haven’t heard the buzz or experienced it for yourself, the FatWallet Finance Forum users are a wealth – pun not intended but not avoided – of information. The collective intelligence and whistle blowing abilities of these discussions are referenced by news sources, like Reuters, and The New York Times. Below, you’ll find Finance Forum discussions and reviews of tax software:
Want to know when the next tax discussion posts?
While I’m uncertain of my own financial skills, I do know how to reference the FatWallet community resources. The sheer number of forum participants produce collaborative results on hot topics, like tax advice and tax software. If you don’t already, “lurk” around and see what you can learn. And where you have knowledge to add, please, contribute and add your strength to the process.
Update: I recently found a series of posts on My Dollar Plan that review simple tax deduction options.