There is nothing pleasant about filing taxes. Whether you are a believer in the current system of government assistance or not, sending in your tax forms each year is a requirement for those who have earned enough. That means that you want to save as much money in the preparation process as possible, without bending the law.
Gone are the days when someone filing taxes would sit down with a pencil, a calculator and a slide rule as well as a bagful of receipts. Today, if you want to go at it alone, you can find several excellent Tax Prep software products at many brick and mortar stores. Which one you choose is really a matter of personal preference, but after you try one or two you will know what works best for you. You can also use online versions, which is essentially the same as a program you install on your computer.
These programs will walk you through the process of filling your tax forms and optimize any and all deductions for which you qualify. Another nice feature is the flexibility to walk away and get back to things at a later date.
Avoid Seasonal Tax Prep Offices
Each year numerous companies suddenly offer Tax Preparation services. They charge you to use the same kind of software you could purchase yourself for less money. The only difference is that they organize your bills rather than you doing so. Frankly, take a couple of days and sort your own stuff. Why pay someone else $300 to do the same thing you could accomplish with $80 of software?
Barter for Services
If you have a friend or acquaintance who is a CPA, offer to trade services with them. I, for example, am a massage therapist, and I have a CPA friend. Each year I offer him two massages to prepare my business taxes. He often gives the massages as gift certificates to his wife as birthday gifts, and I get my taxes done by a professional. It’s a great set up. You can surely find a service you can use in barter.
Don’t Miss Your Deadlines
If preparing your taxes by the deadline isn’t possible, make sure you send in an extension request, and then don’t forget to send them on the revised date. If you miss your date you will end up paying fines as well as interest, so it just isn’t worthwhile. Staying on top of this is your job, not that of the IRS.
Don’t forget that while you can file an extension for your return, you cannot be late with any amount that you owe the IRS. If you need to be late, you still need to send in every dollar that you think you will owe.
Be Old Fashioned
Filing electronically is faster and you save money on stamps. Make sure you hold onto a copy of your Federal and State files. You can send them electronically at no charge through the Federal IRS website. However, you want to be very careful. If you don’t watch out you will be hit with a bunch of fees and it would have been cheaper to file the old fashion way.
While giving the government your money may not be your favorite activity in the world, it is possible to pay them properly while saving money on filing taxes.
This is a piece taken from the How to Save Money on Everything. Check out the free frugal email newsletter and get your free copy.