March 9, 2010 -- Doing your taxes is tedious, but new Web tools can help make the process easier and more accurate.
File for Free
Free online filing tools are provided for those who qualify by H&R Block, TaxAct, and TurboTax. These companies offer online filing for basic federal tax returns. That means no forms, no mailing; it's all done via computer. And submission is faster than mail and it's easier to track your return status. The IRS has a list of all the companies that offer this service and the restrictions about who is eligible.
Click HERE for the IRS ' list and other information.
The IRS allows you to file certain forms for free on its Web site, but it's for people who don't need context or prompts about what each form requires. Another consideration, filing is limited on the irs.gov site to people with $57,000 or less in adjusted gross income or who meet other criteria concerning military service or tax status.
Click HERE for information on how you can file free with the IRS.
According to Intuit, the maker of TurboTax, 20 states have created free filing programs based upon the federal Free File Alliance model: Alabama, Arkansas, Arizona, Georgia, Iowa, Idaho, Kentucky, Michigan, Minnesota, Missouri, Mississippi, New York, North Carolina, North Dakota, Oklahoma, Oregon, Rhode Island, South Carolina, Vermont and West Virginia.
If you live in one of the above states and qualify to file a free state tax return (income limits or active military duty) you can file your state return for free.
Click HERE to file your state tax return for free.
Estimate Value of Charitable Donations and Mileage
If you donated bags of clothing, furniture, electronic equipment, baby gear etc to a non-profit you probably didn't think to value all of the items. Or maybe you didn't know how to estimate an accurate value?
Charitydeductions.com uses current eBay data to estimate the value of items you donate to charity. It lets you adjust for the condition of the items you donated, it keeps a tally of your donations, and it lets you print out the list. It roughly estimates what that donation actually shaves off your tax bill. You can also input any mileage you accrued while doing charity work and it will log and value that mileage.
Here's another tip. If you didn't keep an odometer log of your mileage for charity or business driving, use Google maps to estimate mileage. Input your start point and destination in the directions portion of Google maps. It will tell you the mileage for the one way journey. Add a third destination for the round-trip mileage.
If you itemize your deductions, you have sat down with a stack of receipts and started the laborious task of tallying them up. But here's a trick: many credit card companies let you download all your monthly statements. Once you have the electronic versions on your computer, you can cut and paste transactions from those logs into Microsoft Excel or another spreadsheet/table program and keep your tally digitally. This is so much easier than sorting through those credit card receipts and manually entering each deductible purchase.
Get Your Withholding Right for Next Year
The goal with taxes is to have your withholding or estimated tax payments right through the year so you are neither owed a big refund nor forced to make a big payment to the IRS. If you do have a significant imbalance, it probably means your paycheck withholding is screwed up. You have either claimed too many or too few allowances.
Click HERE for a withholding calculator to determine how many allowances to claim in the hopes of getting your withholding closer to your actual tax liability.
Once you've determined the proper number of allowances to claim, you fill out a new W4 with your HR department and they adjust the withholding in your paycheck.
And about that paycheck, with the new amount of withholding, what will your take-home pay actually be?
Click HERE for a paycheck calculator to get a sense of your adjusted monthly income.
Check Your Refund Status
On the left hand side of the irs.gov Web site is a link where you can check the status of your refund. This service will tell you the estimated delivery date of your tax refund. The IRS says "you can generally get information about your refund 72 hours after IRS acknowledges receipt of your e-filed return, or three to four weeks after mailing a paper return."
The IRS never initiates communication with tax-payers via e-mail, NEVER. So ignore any unsolicited e-mail about taxes -- it's spam and probably a scam.