How To File Federal Taxes Online
17 Apr
This guide will make it easy for anyone to file federal taxes online.
There are many websites that make it easy for an individual to electronically file his or her federal income taxes online. The first place to check would be the IRS website itself, which offers Free File to everyone. If a taxpayer has less than $58,000 adjusted gross income (AGI), he or she would be eligible to download the free software. According to the IRS, 70% of US taxpayers will fall in this range. For the 30% who make more, they can either use the fillable electronic forms provided online or pick one of the many other online efilers. A few to check would be TaxACT, TurboTax Online or H&R Block.
The first thing the taxpayer would need when filing federal taxes online would be the prior year's tax return. If this will be the first time for efiling, the AGI of the prior year will be needed in order for the IRS to accept the efiled return. If previous returns have been efiled, the special five digit code assigned can also be used to further prove the taxpayer's identity. If that code cannot be remembered, the previous year's AGI can always be used instead.
Beware of Data Entry Errors when Filing Federal Taxes Online
One of the most important things to remember when filing taxes online is attention to detail. Typing in a misspelled last name and/or reversing a few digits in a social security number will lead to a quick rejection from the IRS. This goes for all tax ID's and earnings from employers as well. The last thing a taxpayer wants is to receive a rejection due to a simple entry mistake. Federal tax software like TurboTax Online Federal or H&R Block Home Online Federal will verify all information after the forms have been completed, but make sure to double check all entries before submitting the completed return online.
Before attempting to file online, make sure that all required tax documents have been received. Just because a W-2 has arrived does not mean that tax returns can be completed. There might be 1099's forthcoming. Anyone who has bank accounts might have earned interest. Those with mutual funds or stocks could have earned dividends. Having to file an amended return isn't fun for anyone, so it's best to be fully prepared before getting online to file taxes.
Be Sure to Enter all Deductions to see if Itemizing Pays Off
Many taxpayers use the standard deduction since they assume they won't have enough deductions to be able to itemize. It will only take a few more minutes to enter all those deductions when filing taxes online to determine which method is better, and there are even programs which specialize in handling itemized deductions, such as CompleteTax Delux. And getting even a few hundred more in deductions will make it worth it. Have all possible deductions handy before getting online, to make it easier to input these amounts when prompted by the chosen efiler.
One of the most important things that many efilers forget to do is to print the return. Never file online without making sure to print a hard copy first. Keep all information backed up with that printout and file it away somewhere safe. All taxpayers should keep copies of their filed tax returns for at least 7 years. It's always a good idea to keep them indefinitely as well, since it can be interesting to look back on prior years' returns. Most tax software will also save copies of completed tax returns, making it quite easy, not to mention convenient, to file federal taxes online.
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