We’ve previously shared a tax preparation checklist, which we hope you were able to utilize. Now with all your documentation in hand, it’s time to move on to the next phase: tax preparation. Whether you decide to do it yourself, grab some software, or look for professional tax preparation in Houston, read below for some help.
Tax Preparation for the Do It Yourself-er
Those with simple returns can actually have an easy time of it if there is only one or two W-2 forms to claim and few deductions. The form 1040EZ was designed just for this type of tax payer and can be filled out in a short matter of time. However, there can be drawbacks to this approach given how many deductions and credits are out there. The 1040EZ does not cover them all, and it can make financial sense for many to opt for the long form.
Tax Preparation Software
Every year we are inundated with the latest in new and easy to use software that promises to get you all the deductions and most favorable tax outcome possible. While many of them are great and do allow for common and uncommon deductions and credits, they also lack the human touch and can be more complicated than advertised. However, tax experienced individuals who have learned the ropes and are familiar with their returns can benefit from certain tax preparation software. The Simple Dollar ranked their Top 5 Tax Preparation Tools for 2015 and the winners were:
- Turbo Tax – A familiar name, they have been around since the first tax preparation software came out many years ago. They have over 350 tax deductions for you to choose from, and for the first time in 2015, they are charging $0 for filing a state return, an option that is meaningless to those doing tax preparation in Houston, Texas (but it is beneficial in other states).
- H&R Block Tax Preparation software – Their platform is easy to understand and use, if your return is simple. However, the most basic package costs $19.95 and doesn’t include as much as the above. However, H&R Block promises free technical support by phone or chat.
- Tax ACT – Like Turbo Tax, this software lets you feel a simple federal return for free. It includes a variety of itemizers as well as help and support. There is also a paid and Ultimate Bundle version with support for state taxes and other frills.
- Tax Slayer – Like the above, this tools has many free and paid options. However, it is the only one that explicitly states that you can deduct your tax preparation fees from your refund at no charge. You can even use their online refund calculator to get a free estimate.
- E-smart Tax – This little known tax preparation software has the usual free, paid, and support options. It is provided by Liberty Tax and allows you to start your tax return and lock in your price even if you file and pay later.
Tax Preparation Tips
Whether doing your taxes yourself or using software for tax preparation, there are few tips to keep in mind.
- Know before you pay. Many, if not all, tax preparation tools will tell you the amount of your refund before charging you a dime. It may be worth trying a few to see which is best for you.
- If a tax preparation software offers free technical and tax preparation support, don’t be afraid to use it. Better to put up with the wait times than to file incorrectly.
- You are still responsible. No matter which software you use, you are still responsible for what you file. Even if the software didn’t ask for a certain form of income, you still must claim it. Likewise, just because a software offers you a credit or deduction, it doesn’t mean you are eligible for it.
Tax Preparation With a Professional
Those of you with small businesses, complex returns, or who are just plain short on time and/or patience for filing taxes may choose to hire a professional to take care of all of it for you. However, just because “tax preparation professional” is in their title, it doesn’t necessarily mean that. Likewise, a CPA (certified public accountant) may be an expert in certain kinds of accounting and taxes but not necessarily the kind you need.
When looking for a tax preparation professional, go simple. A few Google or Yelp reviews can tell you tons about who you are dealing with, and any decent tax preparation professional will take your call and spend a few minutes talking to you even if you aren’t a current client.
Looking for Tax Preparation in Houston?
And if you are in need of tax preparation in Houston, please contact me or send me an email.