Doing Your Tax Returns Online
Want to take charge of your own taxes this year? If you've got a reasonably simple return — you don't own your own business, say, or you don't actively trade stocks — you may want to join the millions of people planning to file online. Not only will you get your refund back faster than with a handwritten return, you're also likely to make fewer math mistakes. Added benefit: Filing online is cheaper than buying tax-preparation software at a store and lugging it home (and certainly cheaper than hiring a professional to help you).
The two most popular services are from companies that have defined consumer tax software for more than a decade: Intuit's Quicken TurboTax for the Web and TaxCut from H&R Block. The good news: this year everyone qualifies for free federal income tax preparation and e-filing from both services, as long as you access them through the IRS Web site's Free File service. (Otherwise, TurboTax will charge you $19.95 and H&R Block, $29.95.) State taxes will set you back $19.95; $9.95 with TurboTax if you file Form 1040-EZ.
Both services are equally easy to use and have the IRS's seal of approval, which is the lightning-bolt logo awarded to companies that meet the service's standards for electronic preparers.
One note of warning: Don't wait until the last minute to e-file. Even though it seems you should be able to file electronically in the blink of an eye, things take a little more time, especially right at the deadline. Here's why: Your completed and signed forms don't get shot straight to the IRS from your PC. Instead, they go to whatever firm provided you the online service. It then batches the forms together and sends them off to the IRS. Give yourself some time to get comfortable with the software, and avoid any last-minute service jams.