Friday, February 24, 2012

Tax Preparation

I would say that for many, tax preparation is a daunting task. Many people that I know use tax preparers to help them with their tax returns and that is fine for them.

For me, I always remember my dad doing our taxes. When I got older, he would help me do my taxes. To me, this is just the way it was, you did your own taxes.

So, when I grew up, I just assumed that I would do my own taxes and I did. Problem was, as I got older, it seemed that my returns got harder too.

A few years ago, I started using tax preparation software, instead of doing them on paper. I think the first year, we had a try me free or for $5 or $10 through one of my husband's magazine subscriptions - so it was a great way to check it out with minimal risk. That year, I remember doing my return on paper first and then doing it online. I wanted to see how it worked, and since I'm me, make sure it was right. I was surprised both at how easy it was and how complete it was. They ask questions, allow you to select forms from lists, and have 'tips' throughout, all to help you along. (If you want, many even offer, for an added fee, some other services too.) The way that the program steps you through the taxes makes self-preparation that much easier.

I've now migrated to the online version (I use H&R Block, personally - but there are others out there). I love that by doing my taxes on the computer, I can e-file for free (included in the price of the software/access). This means that with direct deposit my refund gets to me within just a couple of weeks.

I actually am fortunate too that I don't have to pay for the state portion of the return on the program, because Ohio allows you to do your taxes online for free through their iFile program. Again, easy-peasy. Answer a few questions, enter a few numbers from your W2/1099s and your Federal Taxes and they put the numbers where they belong. Again, if you are due a refund, with direct deposit, you receive it within a few weeks.

This year, my local taxes started offering online preparation through their site. I tried to complete them, but learned that even though I owed overall, because I had overpaid on one of our work city estimates I was not able to file online. So, back to paper it was. I found it amusing that their software couldn't handle a refund or even making a credit to another portion of the form like next year's estimates.

Doing my own taxes with the help of my computer, works for me. This post shared at Frugal Friday.