4 tips for e-filing your taxes
(MoneyWatch) You've about three weeks left to file your taxes. If you're putting it off until the last minute, well, it's pretty much the last minute. Set some time aside this weekend to pour your financial data into a tax prep program and then file your return electronically. Here are some tips to help you get started.
Choose tax prep software. Sure, you can have your taxes prepared professionally, but tax prep software has made the process fairly straight-forward, even for complicated tax situations, and most tax prep packages are thoroughly refined. As I discussed a few months ago, there are a slew of packages available, both downloadable and online, but a few stand out:
-- TurboTax, from Intuit (INTU), has the best pedigree of any tax prep software available. It's one of the oldest programs and has a great reputation among both consumers and professional tax preparers.
-- H&R Block at Home has almost as many editions as TurboTax. In addition, H&R Block (HRB) powers their offerings with somewhat more powerful support. In addition to helping you complete tax forms, they also offer actual tax advice and will supply real legal representation if you're audited.
-- TaxAct has been around for a long time but doesn't have the same name recognition as veterans like TurboTax. That said, it's got a lot to offer folks with straightforward tax situations, including the promise to pay penalties and fees for errors that result from using their software.
Have all of your documents and records handy. Even if you've done this a million times, it's easy to forget the obvious stuff and scramble all weekend looking for the right pieces of paper, rather than actually doing your taxes. Among the most important things to bring to the table:
-- Prior year returns. If you're using software, be ready to import last year's file
-- All relevant W-2s and 1099s
-- Business receipts
-- Bank account information
-- Records related to investment sales
-- Charitable deductions
-- Medical expenses
-- Your dependents' social security numbers
Avoid the upsell. Take the time to run error and audit checks on your return when you've completed the process. Most tax prep packages will run these checks for you, but beware: they're often co-mingled with offers to upgrade to additional levels of service designed to protect you during an audit or provide other services. You probably don't need to pay for these offers.
Be sure you get an acknowledgement. The IRS should let you know within 48 hours if your return has been received. This is a great benefit that you won't get when filing a paper return, so keep an eye out for it -- if you don't get an email, something has gone awry and you should follow up. It'll also let you know if something is wrong with your return and you need to correct errors and re-file.
