It just so happens to be that time of year again… yep, you got it, tax time. There are a lot of people that look forward to tax time because they know they’re going to be getting a nice refund. There are others that dread tax time because they will end up having to pay taxes to uncle Sam. Have you ever thought about doing your own taxes using an online tax program?
So far, in my lifetime of filing taxes, I have only had to pay taxes back once. Every other year, I have gotten a refund ranging from a few hundred dollars, to over $10,000. Want to know how? By using an online tax program!
How to do Your own Taxes Online
I began doing my own taxes using Turbo Tax online approximately 7 years ago. You could purchase a software program to use, but if you use the online version, their tax forms get updated every year, so you do not have to worry about a software program being outdated. I prefer to just do my taxes online for that reason. These programs will walk you through doing your federal tax and state tax returns (if you have to file a state tax return like I do).
The difference between doing taxes yourself, or using a pop-up tax preparer, is that you normally do a 1040-EZ with them. Unless you want to pay however much it costs to go through an actual accountant (which I hear is expensive, and I have never personally done), the pop-up tax preparer’s typically will not itemize your taxes, thus making your refund a lot less. I had actually applied to be a tax preparer at one time in my life, and they quickly train you for a few weeks then assign you to a temporary place to do taxes for a couple of months. I don’t know how detailed the training is, but I do not imagine it being detailed enough to do intricate taxes; just good enough to get by with the common easy 1040-EZ’s.
How to get Your biggest Refund
If you want your biggest refund, I would highly recommend you do your own taxes online, and itemize. If you purchased a home, or pay a mortgage, taxes, and insurance, all of that is tax deductible. If you pay co-pays for medical visits, prescriptions, dental, optometry, etc., these are also tax deductible.
I keep and file every single receipt and bill having to do with any of the above mentioned subjects. Each year I have a folder and name it 2016 Taxes, for example. When I get a receipt, I put it in the folder. If I receive a bill in the mail, I write the date and how it was paid, then file it in the folder.
Other tax deductible items:
- taxes paid on a brand new vehicle
- taxes paid on brand new recreational items, boats, trailers, etc.
- annual vehicle taxes (if your state does this)
- property taxes
- out of pocket medical expenses
- mileage if you have to drive quite a distance to medical appointments *Keep track in a notebook and file in the folder so you have proof and accurate information*
- college/university expenses
- job expenses
- business expenses (for business owners and direct sales business owners)
- daycare costs
- moving expenses (if you moved for a job and they didn’t reimburse you)
- pet expenses if your pet is a service animal
- if you are disabled, items you have to purchase because of that, and any home or vehicle modifications that had to be done (only if these were out of pocket expenses)
- previous year tax preparer fees
There are definitely more tax deductible items, but this is just a start. If you’re not sure, keep the receipt or work order so that you have proof of the cost and the date. Unless you amend a previous tax year, you cannot deduct items in a year that you are not filing taxes for; for example, if you had a huge medical bill in 2014, and did not deduct it when you did your 2014 taxes, you cannot deduct it for 2015. Sometimes when going through the online tax program you get asked if you have something from a previous year to add, but it is rare.
Select which online tax program you want to use. A few out there are Turbo Tax, H&R Block, and Tax Act. Compare prices and peruse for ease of use before deciding. I have personally used Turbo Tax every single year, except for 2014 I used H&R Block. The reason I decided to use H&R Block for one year is because we had gotten solar panels installed on our home, and at the time of taxes Turbo Tax did not have the federal forms for me to do online – H&R Block did, so I went with them.
Wait for all of your W-2’s, 1099’s, property tax and vehicle tax documents, bank tax documents, if you have mutual funds or stocks – these documents, and anything else you personally receive statements for at the beginning of the year for tax season. Most people begin receiving their documents in late January to early February. I personally have a list, and cross off items as I receive them so that I know when I may begin my taxes.
Login to your tax program of choice and begin filling out the data they require. If you’re going to itemize, from the start you should select an option other than basic prior to beginning as well. Most programs are able to import your W-2’s as long as you have information pertaining to them to verify. Most programs will allow you to walk through each and every subject so that you do not miss anything. Do it!! Even if I know a particular section won’t do anything for me, I still visit it just in case. You never know, you could have something you didn’t realize was deductible 🙂
Doing your own taxes will probably take you a few hours, if not a couple of days. Don’t worry, the online programs save your data and you are able to log back in anytime to finish them. Sometimes you may come across a subject and you don’t have the paperwork or information you need at the time. You can always go back to it once you have what you need to complete it.
Once you have visited every subject and know you are done, then it is time to file your taxes. These programs will file them electronically for you, as well as do the checks to make sure nothing is missing. They will also show you your likelihood of being audited. As long as you do everything correctly and have the documentation for what you filed, you have nothing to worry about if you end up getting audited.
Once you successfully filed, sit back, relax, and expect to get your refund in about 3-4 weeks!!
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