Tax Prep

This year, I returned to an old favorite web site.

For the past two years, I paid a tax prep firm to prepare my tax returns. The biggest reason for this was because I had been shoveling money into my 401k at an old job in 2007, and then wanted to convert it to a Roth IRA. I had absolutely no idea how to treat that for tax purposes as it was the first year you could do a conversion, so I was forced inclined to get some professional help. The next year, I decided to go back to the same firm because I was pretty busy with work. Easy to justify at the time, but in hindsight, very expensive.

These two years were an aberration for me, after doing my own taxes for a few years. Before that, my Mom was awesome enough to help me out because while I had my first job at 16, I had no clue didn't care how to do taxes at the time.

This year, as I was reviewing my prior tax returns, I realized that I could return to my old ways and save money at the same time. If you havn't filed your own taxes, it can definitely take a while to get used to. Fortunately, there are some easy programs out there that will help you in your tax prep. The comment I have heard (and subscribed to last year), is "why not let a professional do it for you?" The answer to this is actually a question. What does your tax preparer do differently than  you can do yourself?

The answer is a bit of homework, but beyond that, not much! You can use a program that will ask you the questions that may apply to your tax treatment and easily save yourself a good bit of cash. Any parts of the tax code you are unsure of can be remedied by a trip to the IRS website (no fun to read, but think about the money you are saving.)

In most programs, you can easily reference any questions you may have as they directly show which IRS document to use to clarify your concerns.

Taxact is the website that I have used in the past, and decided to use again this year. I saved the tax prep fee that I was paying, and only spend a few hours doing the work. Your tax return may only take an hour, or just a few to prepare, but consider it as paying yourself for doing the work.

In all, I paid $14.95 to electronically file my California tax return. Taxact offers free Federal tax return preparation and electronic filing. That's a pretty decent deal. FREE.

TAXACT is awesome.