Best Way to Do Your Taxes This Year: 7 Smart Methods

best way to do your taxes

It’s no surprise that 56% of Americans either dislike or hate doing their taxes. It’s a stressful and complicated process that can take countless hours of your valuable time.

But what of the Americans who say they enjoy the process? Have they discovered the best way to do your taxes?

The truth is, there isn’t one best way to file taxes… there are 7.

If you’re one of the millions of Americans that thinks April 15 comes too soon every year, your annual stress stops here. We’ve compiled a list of the smartest methods for making your tax season hassle-free.

You can easily be one of the Americans that enjoys doing their taxes, read on to find out how.

Financial Planning

If taxes are the least of your minimal financial know-how, you can consider hiring a financial planner.

Financial planners aren’t going to show you how to prepare tax returns, but they can start showing you where to save on your annual taxes and how to maximize the return that you get. Beyond taxes, they help with everything from risk management and retirement to estate planning and asset allocation.

Avoid commision-based financial planners – they might be more concerned about their bottom line than helping you with yours. Choose instead from planners that work from a combination of commission and fees, fee-offset, fee-only or salary.

You’ll also want to be sure you choose a Certified Financial Planner, so you know you’re getting the professional service and advice you’re paying for.

Financial planners aren’t just for individuals and families, they’re also an option for businesses.

Businesses arguably need more financial advice the larger they get and a good planner can show you how to save and manage taxable income.

Free File Alliance

When your adjusted gross income is less than $66,000, you are eligible to use Free File filing software.

Through a partnership between the IRS and a number of private sector tax software companies known as the Free File Alliance, Free File allows you to prepare and file your federal taxes without having to pay any fees.

This commercial online software is provided by the Free File Alliance companies and it’s relatively easy to use. An interactive “Help Me Find Free File Software” helps you choose the best tax software for your personal situation.

Once you’ve filled out your tax information and the return is complete and e-filed, you receive an e-mail letting you know whether the return was accepted or rejected. Any refunds you are owed will come to you via direct deposit.

Free File Fillable Forms

In the case that your adjusted gross income is higher than $66,000, you can use Fillable Forms to submit your tax return. Fillable Forms is an electronic version of IRS tax forms right on your computer display and you submit these online.

Fillable Forms doesn’t give you the software that walks you through tax preparation. It does, however, do basic math calculations for you and it’s completely free to use.

Turbo Tax

One of the best ways to do your taxes online is to use Turbo Tax. If you’re computer-savvy and have a relatively simple return, this software is an inexpensive and efficient option.

It’s easy to use because it minimizes the entire tax code into simple questions while at the same time educating you (if you ask it to tell you the tax rule behind the questions it’s asking).

“Absolute Zero” is the free version of Turbo Tax for basic federal and state e-files. If you have something more complicated, you can transfer your data and upgrade.

Turbo Tax is even appropriate for businesses just starting out, but you’ll have to pay for that service.

H&R Block

H&R Block has both an online and in-store solution for how to prepare taxes. It’s a quick and efficient choice that doesn’t cost much and, if your return is simple enough, might even be free.

“More Zero” is online software that can be used for federal and state taxes, with no income or age restrictions. Like Turbo Tax, you can upgrade when and if you need to.

If you prefer the face-to-face of in-store assistance, H&R Bloc has storefronts across the country. They train their employees well and have a review process to ensure you’re getting back what you’re owed.

Tax Preparation Professionals

If we had a nickel for everytime someone told us “I don’t know where to get my taxes done”, we’d have to file a tax return for all of our nickels.

If you don’t have the time or inclination to prepare taxes, why not let the professionals do the heavy lifting for you?

Tax preparation professionals include enrolled agents, CPA’s, tax attorneys, or a service firm with a combination of these professionals.

Tax preparation service firms, especially those that have CPA oversight, are experts in tax law – they know exactly what you need to file, when to file and how to maximize your return

Whether you’re filing a personal return or you have more complicated taxes as a small- or medium-sized business, a tax preparation firm is one of the best ways to file taxes.

As a bonus, many of these firms or individual professionals offer year-round advice and act in the capacity of a financial adviser. Of course, this all comes at fee heavier than most of the aforementioned options.

What Isn’t the Best Way to Do Your Taxes?

Considering that 70% of Americans are eligible to prepare and file their tax returns by themselves, it’s a method that many choose.

If you decide to prepare and file your taxes on your own, here are a few simple tips on the best ways to avoid headaches:

  • Review your tax return from the previous year, both federal and state. You can use a lot of that information to fill in easily missed gaps, such as federal ID numbers, social security numbers, filing status, etc.
  • Ensure you have all of the needed documentation in order before you get started to avoid disorganization.
  • File on time and know the filing deadlines. Note: April 15 can change due to holidays and weekends.
  • Check and double check for common mistakes, such as bad math, misspelling or providing the wrong name, wrong bank account details, and forgetting to sign the return.

Still Not Sure?

We’re here to help! Contact us for more information on financial planning and how we can show you how to plan for maximizing your returns.

By | July 25th, 2018|Taxes|

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