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Every year, most taxpayers find themselves in difficulty when it comes to paying income taxes in due time. Only those, who are familiar to filing taxes online for free, find it easy and hassle-free to complete income taxes. If you want to file taxes for free, get to know about how it can be possible. Go through some useful tax sites and e-file services to get ideas as to how you can avail free federal tax filing.
The official IRS site, which is located at irs.gov, can be a fine source for information regarding preparing and free federal tax filing. To avail free tax file advantages, check out whether you excellence or not for using Free File program offered by the IRS which is quick, secure and free of charge. Free File is available with some top leading software which you have to choose for getting your taxes completed right in time. You can prepare and e-file your federal income tax returns for free if you become eligible for using it.
Your desire to file taxes for free can be fulfilled if you are qualified for using Free File tax software but the situation is your adjusted gross income should be $58,000 or less. However, there are quite a few important IRS approved tax sites which may let you finish your federal taxes for free or at the cost which you can afford easily.
Lets you complete your entire filing task online in easy way. With the expert guidance of the software and step by step procedures, your entire task becomes simple and convenient. Proper information and details you have to insert into the system if you aim at accurate tax return. If your e-filed return reached the IRS service center accurately, you will get notified quickly about the acceptance of your return. This makes you worry-free as your return is electronically filed in proper manner. For those who are expecting refunds can make the process faster by choosing direct deposit.Source: articlesbase.com
How does a deduction maximizer work to increase your tax refund?
Tax deductions and credits are what enable you to reduce the amount of tax you pay, or to get a larger tax refund. You may be tempted to settle for standard tax deductions and credits, and wind up paying the IRS more than you should. The deduction maximizer will alert you to overlooked tax deductions and credits you may qualify for.
Here are a few of the over 350 free tax deductions and credits available to you:
- Home mortgage interest, real estate taxes, property taxes
- Education expenses
- Earned income credit, child tax credit, child care credit
- Energy tax credits
- State and local income taxes
- Charitable contributions
- Home office deduction
- Medical and dental expenses
You could spend a lot of money, paying a tax accountant to find these overlooked tax deductions and credits, but you no longer have to. There are tools on the Internet that can help you can master the skill of finding tax deductions and credits, and achieve a triple or even quadruple digit increase in your income tax refund. Many taxpayers settle for the standard deduction rather than exploring the many tax deductions available to them. Before you settle for the standard tax deductions, take a few minutes to explore the over 350 Federal tax deductions and credits.
Labels: Federal Income Tax Refund
If you've never checked-out whether itemizing would benefit you, then you may be paying more taxes than you should. You may be settling for fewer tax deductions than you are legally entitled to.
To decide whether itemizing your taxreturn would help to reduce your tax burden, you can try running the numbers for these common tax deductions.
You may be able to maximize your deductions with mortgage interest, state and local taxes, donations, education, medical expenses, and investments.
Many taxpayers can save a lot of money by itemizing when it comes to mortgages or home equity loans. You can see whether your tax deduction is larger by itemizing or by taking the standard deductions, with the aid of an online tax preparation program.
An online tax software program will help you decide whether you should take the standard deduction or itemize. All you do is type in the numbers and the tax program will automatically do all the calculations for you. It will even supply you with the right forms and information for each deduction.
Just run the numbers! The best way to maximize your Federal and State income tax deductions is to run the numbers. Navigate to a tax filing website, create a user account, then just run the numbers to see how you can maximize your Federal and State Tax Deductions.
Most online taxfiling sites function similarly. First, you must establish an account by setting up a user name, password, and providing an email address. An email confirmation will be sent automatically, and including a secure link to the site for confirmation of your identity.
Once your identity has been verified, you can begin entering information. These sites are generally divided into several sections. First, basic information such as your name, address, filing status, and name of dependents must be provided. The next section requires entry of information from your W-2s, and then you will be asked questions to determine what, if any, deductions you may have in order to determine your taxable income. Finally, the program calculates the amount of your income tax, and depending on your status, the amount you owe or your refund.
Once all the information has been entered, you can file electronically. Many sites provide free federal tax preparation and filing, but charge for the state tax preparation and filing service. You must pay any fees prior to the actual filing using a either a credit or debit card. You will also be asked how your refund should be processed. Generally, you can choose to have a check sent or for the money to be deposited into your checking or savings account.
If you have not previously filed electronically, you must either sign electronically (you need to have the previous year’s return to do this), or opt to sign a paper form, which will be mailed to you after you have filed.
After you have paid, you will have an opportunity to print out your return for review prior to filing. If everything looks okay, your return can be filed. Click the appropriate button, and then wait for verification that the transaction was processed successfully. You should also receive email confirmation of this transaction.
Anyone who files a 1040EZ or 1040 can file online with most of the sites. If your return is more complex, the selection is more limited, and it may be advisable to use a tax accountant. However, most of these sites can handle 1099s and business deductions.
Some tax software vendors offer free online tax preparation depending on your income level. A list of sites is available on the IRS web site indicating the income level at which they offer the free filing service. Be aware, though, that the free filing only pertains to your federal tax return, not the state.
Once you have used a tax service, your information is stored for the next tax-filing year. Write down your user name and password on the hard copy of your tax form, also noting the site’s address. This will ensure that, next year, you will be able to log in and proceed without having to enter any preliminary information.
Taxpayers who use IRS e-file and who choose direct deposit can receive their refund in as little as ten days. With e-file there is no paper return going to the IRS and with direct deposit, there is no paper refund going to the taxpayer. It’s all electronic. Tax return information is protected through encryption. Taxpayers receive an acknowledgment within 48 hours that the IRS has accepted the return.
“IRS e-file is the fastest, easiest and most accurate way to file a tax return,” said IRS Acting Commissioner Linda E. Stiff. "We strongly encourage taxpayers to take advantage of the benefits that electronic filing offers."
IRS e-file allows taxpayers to file their return now and pay later if they owe taxes. It allows taxpayers to file both the federal and most state returns at the same time.
Taxpayers may use IRS e-file through their tax preparer, or with a computer using tax preparation software. This software is available on the Internet for online use or for download. Many retail stores sell the software for offline use. The IRS does not charge taxpayers to e-file their completed returns, but some tax preparers and software manufactures may charge a fee.
To get all the benefits of e-file, taxpayers must make sure that when they are done with their return, they take the final step of e-filing it. Taxpayers who use a paid preparer should make sure their preparer is taking this final step, too. Why? In addition to error checks inherent in the return-preparation software, additional checks are done during the transmission process. That's why the error rate is so low for e-filed returns. In fact, the error rate is significantly reduced from 20 percent with paper returns to about 1 percent with e-filed returns.
Free File, which is a form of e-file, is a free federal tax preparation and electronic filing program for eligible taxpayers developed through a partnership between the IRS and the Free File Alliance LLC. The Alliance is a group of private-sector tax- software companies. Since Free File’s debut in 2003, a total of more than 18 million returns have been prepared and e-filed through the program.
Free File allows taxpayers with an Adjusted Gross Income (AGI) of $54,000 or less in 2008 to e-file their federal tax returns for free. That means 70 percent of all taxpayers – 97 million taxpayers – can take advantage of the Free File program.
E-File Usage Grows Every Year
IRS e-file totaled nearly 80 million tax returns in 2008. Almost 57 percent of all returns were filed electronically. Last year, there was a surge in e-file from home computers. There were also significant increases in e-filing by people with a balance due using credit cards and Electronic Funds Transfer (EFT) payment options.
The IRS began the e-file program in 1986 as a pilot project in three cities: Cincinnati, Phoenix and Raleigh-Durham, N.C. That year, there were 25,000 tax returns filed electronically. The e-file program expanded nationwide in 1990 and 4.2 million tax returns were filed. IRS e-file has undergone tremendous growth each year.
In order to qualify for the free tax file service you must meet one of these eligibility requirements.
Your 2007 adjusted gross income (AGI) must be $28.000 or less. If your adjusted gross income is more that $28.000 you may not be eligible for free electronic tax filing. Or
Any Military, Reservist, or National Guard member whose gross income (AGI) for 2007 is less than $52.000 qualifies for free online tax filing. Or If you qualify for the earned income credit (EIC) for tax year 2007 then you qualify for Free Federal Tax Preparation filing.
To use Free File you must use one of the tax filing companies that has been approved by the Internal Revenue Service (IRS). Free tax filing can only be done through a computer with an Internet connection. Paper returns are not an option with Free File. The program also offers free Federal tax filing for those who qualify. Currently there are 21 states participating in the free tax file program. The tax preparation company you choose should have a list of the 21 participating states.
Filing your federal incometax online seems intimidating at first, but is actually the fastest and easiest way to file, and you'd be amazed how quickly you can receive your tax refund by filing online. If you're not exactly a "Internet person," you may have reservations about filing your taxes online. But never fear, the process is actually much simpler than you might expect, and you will have a full record of your filing and all the necessary paperwork to prove you have properly filed your return.
In this article we will guide you through a few important tips for filing your federal income tax online. Once you get used to the process, you'll wonder how you ever managed to file your taxes the "old-fashioned" way. Now, let's get started.
1. The first step is to locate a tax filing web site to assist you in filing your return online. There are many of these to choose from, and the best among them offer a trial of their services at no charge. It is recommended that you go with a company that offers this free trial so you can determine if the site meets your needs and has proper documentation and online help available. It's not enough to simply "take their word for it," but rather, you need to actually use the online service for yourself to be sure you are comfortable with it. That's why choosing a web site with a free trial program is so important.
2. Ease of use is incredibly important online, and nowhere is this more critical than with filing your federal tax return. Look for a web site that has clear, easy to follow instructions, and an interview-type entry form to gather all your pertinent information.
3. If you are receiving a tax refund this year, you will get your money much quicker by having the refund deposited directly into your bank account. Look for web site that offers information about direct deposit tax refunds. The refund itself should be in your bank account 10 to 14 days after you file your electronic tax return. Receiving a refund check, however, can take twice as long in many cases.
Follow these for simple tips to file your Free Income Tax Online and receive your refund quicker this year.
In October of 2005, the IRS and the same group of tax software companies reached a new four year partnership agreement for free filing of taxes online. The new Free File Alliance agreement continues to provide free Federal tax filing to those who have an adjusted gross income (AGI) to the agreementless. This amount will vary among the tax software partners.
Why is the Internal Revenue doing this?
* The IRS has a goal of 80% of all Federal tax returns to be filed online. Currently over 70 million people are filing their taxes online.
* The Federal Government believes that electronic tax preparation provides a more accurate way of preparing and filing taxes.
* The Federal Government also believes that a partnership with existing tax software companies will provide the the best service to taxpayers.
The Free File Alliance provides free federal tax filing and preparation at no cost to those who qualify.
If your adjusted gross income was $54,000 or less in 2008 you can use Free File to prepare and e-file your taxes online.
* You qualify for the earned income credit (EIC) for tax year 2008 then you qualify for the free Federal tax filing program or,
To file your taxes for free, go to Turbo Tax Online where you can either begin your free tax filing or read more information about free tax programs. You'll find lot's of up-to-date tax information and handy tax tools, and you'll be able to get your taxes filed before it's to late.
The easiest and quickest way to file a return and obtain a refund, is to do this electronically--a practice already used by more than half of all taxpayers. The conventional way of Free IRS Efile taxes with the IRS has been opposed by online tax filing systems in recent times. Filing online will allow you to get your tax refund in as little as 10 days.
The process of Online Tax Filling is simple and trouble free. The customer first prepares his tax papers personally or approaches professional tax consultants to do so on his behalf. After the tax papers have been prepared they can be effortlessly filed through an IRS e-file provider. Filing can be done online as well, but if an individual is not sure about the mechanics, it is better to seek professional guidance. Usually most tax experts will be licensed IRS e-file providers. The relevant documents are signed and retained by the customer for future reference. The IRS e-file provider then files the returns electronically on the behalf of the customers. Next, the IRS e-file provider sends the customer an acknowledgement mentioning the current status of the filing process.
Online Income Tax Filling eliminates the need for going through tiring steps of rushing to the local IRS offices and post offices and waiting in never ending queues to post the papers before the due date. Office hopping has been completely eliminated. The only thing required is a reliable computer and Internet connection. Mistakes and errors can be corrected online in comparatively less time. Online tax filing has reduced the time gap prior to receiving tax refunds and papers can be printed to maintain precise records for future reference. Online tax filing also facilitates tax payments using credit cards. It has reduced back office processing time considerably.
Join the millions of people who have discovered how easy, online Tax Filling can be. The cost will be much less, your tax forms will get to the IRS with no hand-written errors, and you'll get your Fast Tax Refund in as little as 10 days.
There are a few exemptions from having to pay the tax deduction. These include any money from life insurance earned, any money from gifts or inheritances, money from any personal injury settlements, and any interest earned on state or municipal bonds. There are some considerations when trying to take advantage of any of these exemptions in regards to the income tax deduction, so it is best if you have a tax preparer help you in these instances.
There are few other reasons you may have additional deductions beyond the federal tax deduction. In fact the tax deduction is considered the standard deduction. The following are called 'above-the-line' deductions. These include, trade and business expenses, alimony, IRA contributions, net capital losses and any money used on property that is used to generate an income.Those who earn over a certain amount and have a federal income tax deduction has something called an alternative minimum tax they can take advantage of. Because of having an income that exceeds a certain amount the person may have to pay more on their tax rebate then would allow for them to be able to take advantage of other deductions and credits.
There is one last option for almost anyone; to paying the federal tax deduction straight out and this itemized deduction. This can include state and local income and taxes, donations to charity, employee transfer costs, medical expenses, casualties and any loss that may have been incurred from this and any interest paid on mortgages. Itemized deduction can be a bit more of a hassle than it's worth though, depending on how many of these you qualify for, so check with your tax preparer ahead of time.
In the end is up to you whether or not you will go with just the standard deduction or with a more detailed one such as itemizing. But either way, at least now you hopefully will have a better understanding of some of things involved with a federal income tax reduction.
The three forms used for filing individual federal income tax returns are Form 1040EZ, Form 1040A, and Form 1040. If you are filing a federal income Tax Return on paper, use the simplest form you can. Using the simplest allowable form will reduce the chance of an error that may cost you money or delay the processing of your return.
1040EZ You may qualify to use Form 1040EZ, the simplest form, if:
• Your taxable income is below $100,000
• Your filing status is Single or Married Filing Jointly
• You are under age 65
• You are not claiming any dependents
• Your interest income is $1,500 or less
1040A You may be able to use Form 1040A if:
• Your taxable income is below $100,000
• You have capital gain distributions
• You claim certain tax credits
• You claim deductions for IRA contributions or student loan interest
1040 If you cannot use either a 1040ez or 1040A, you probably need to use Form 1040. You must file form 1040 if:
• Your taxable income is $100,000 or more
• You claim itemized deductions
• You are reporting self-employment income
• You are reporting income from sale of property
• You are claiming the educator expense or higher education tuition and fees
Choosing the correct tax form could mean money in your pocket. Check your tax instructions carefully.
Once you're enrolled, all you have to do is to go online at least one day before your payment is actually due. You will authorize the payment much the same way you would if you were making an online purchase, and the payment will be withdrawn from your account as planned. According the IRS, this method is fast, convenient, easy, and secure. Because there are steps in the process to verify your personal information, you can be sure that no one else will have access to your account.
You can pay your taxes online at any time. The IRS will know that it's you making the payment because, when you enroll in the system, you will be given a personal identification number (PIN) to use whenever you make a payment. Every time you do make a payment, you'll receive a numbered Electronic Funds Transfer acknowledgement.
If you're thinking about paying your taxes online this year, be sure to enroll several days before the filing deadline. According to the IRS website, it may take up to ten days for your enrollment to be processed. Once you have your PIN and are enrolled, however, you only need to make payments one day before they're due.