Filed under: Personal Finance, Savings Experiment
Tax season can come with pricey accountant fees, stress and long wait times. However, you can take the e-filing route and do it yourself online. But is it really worth it? Let's take a closer look.If you're like most people and use a straightforward 1040A or 1040 EZ form when filing, you can actually file your federal returns for free on some tax software sites like TaxAct. This software offers great pricing and all the right tools, but that's only if your taxes aren't too complex. It's also the lowest when it comes to filing for state taxes, as well, which isn't free with most commercial tax software. At about $18 for state and about $21 for a deluxe package, which includes email and telephone support, TaxAct can be a great low-cost choice.
H&R Block offers some inexpensive options, too. For only $20, you can file for your state and federal return, but to qualify for this price you have to use a 1040A form and fit a narrower criteria. While their premium package is a bit pricier at about $50, it does come with more features that can help with more complicated tax returns.
One last thing to remember is that the later you file, the higher the software charges tend to be, so expect to pay more if you procrastinate. And since the IRS processes tax returns on a rolling basis, e-filing can get your returns to you in as little as 21 days if you use direct deposit. That's a lot quicker than the 8-10 weeks that it takes the IRS to process paper returns.
So while the idea of filing your own taxes online can be intimidating, you can potentially save hundreds by doing them yourself online. If you're an investor, property owner or self-employed, though, using an accountant might be a better way to get you more money on your returns. Before you choose, assess your situation, because when it comes to taxes, there are more than a few ways to save.
