Though April 15th is coming up quickly, many people have not filed their tax returns yet. Every year I’m appalled at how much of my income is taken out to go towards worthless government spending (e.g. “pork”).
On that note: Does anyone else find it odd that so much attention is being given to the whole AIG bonus controversy? $130 million is a drop in the bucket compared to the recent stimulus package that was passed, yet it seems to me that even more attention is being given to this comparatively small infraction. If only Congress and the media were so thorough with the entirety of the nearly $1 trillion stimulus bill.
Don’t get me wrong – these bonuses represent more money than any one of us will see in our lifetimes, but to put it into perspective: Imagine you worked long and hard to earn $10,000. If you somehow lost just one of those dollars, would you expend the same amount of effort to find that last dollar as you did to earn the initial $10,000?
I’m no financial genius (or are I?), and I’m not disputing that it’s pretty lousy how our hard-earned tax money is going towards these ridiculous bonuses so soon after AIG begged to be saved by the government; but the amount of coverage given this issue by the media and congress seems… disproportionate.
OK, back to your previously scheduled programming:
On top of the thousands of dollars taken out of our paychecks throughout the year (and potentially having to write another check to make up the difference), the last little twist of the knife is having to pay to have your tax return prepared – via an accountant or with tax software. The good news is that there’s a way to do it for free.
TaxACT – http://www.taxact.com
Doing your own taxes can be scary, particularly if you have a lot of income sources or investments. The good news is today’s various tax software packages do a good job of walking you through the return and asking pertinent questions, taking a lot of the uncertainty out of the process.
The two primarily well-known tax preparation packages are H&R Block’s TaxCut and Intuit’s TurboTax. In the past, you had to purchase the software up front, and then use it to prepare your return. More recently, both services have been made available online:
Unless your tax return is a very simple one (only a W-2, for example), you have to pay for their upgraded services in order to file. But the good news is that you can go through the entire process first for free, regardless of the complexity of your return. You don’t pay until you file.
There is a third online filing service, TaxACT. And they let you file for free – sounds pretty good, right? It is.
So why bother even bringing up TaxCut and TurboTax? Because the ability to doublecheck your work is always a good thing, especially when money or a potential IRS audit is on the line.
For example, last year I was working on my tax return with TaxCut. As I approached the final stages, TaxCut said I owed much more than I anticipated. So I went to the TurboTax website, entered all my information there, and realized that I had neglected to enter my state sales tax deductions – while the option was there in TaxCut, it wasn’t as obvious as it was in TurboTax.
I eventually found the appropriate section in TaxCut, adjusted my numbers and all was well. Being able to doublecheck my work saved me several hundred dollars.
I still had to pay $40 to file my tax return though. $40 isn’t going to send us into crippling poverty, but it will pay for a decent meal out.
This year I went through the entire process with both TaxCut and TurboTax’s web-based programs, checking my work with each program, then did my actual filing with TaxACT. So I was able to have another set of eyes look over my return, if you will, and it didn’t cost me a cent to file.
Pretty good deal, if you ask me.