Using tax software is an easy and cheap alternative to preparing and filing tax returns. Rather than hiring an accountant or other tax professional, you can use a proven and highly rated program to file personal and business taxes on your own. Here are some benefits:
Maximizes Your Tax Deductions
It's hard to keep up with the changes in tax laws. Every year, new deductions are made available to those who work from home, and if you miss them, you'll miss tax savings. A current edition of your software program will make sure you get all those deductions, so that you owe less and get a bigger refund. It will also save you the pain of owing taxes due to changes in state and federal laws.
Files Tax Returns From Your Computer
A tax software includes the option to e-file your taxes. E-filing is faster and more covenient than mailing your taxes. You'll get your refund faster, or have more time to pay your tax liability. Otherwise, you'll be making a trip to the post office and waiting much longer for a check.
Any business can get audited by the Internal Reveune Services ("IRS") at any time. However, a tax software reduces your risks of getting an audit and getting penalized if the IRS comes knocking at your door. A tax software will check your errors before you file. Some will even offer a guarantee for any calculation errors. This means that they'll pay you for any penalties plus interest.
Gets Answers to Tax Questions
Getting an answer to a tax question can be a lot easier using a tax software (than searching the IRS' website). TurboTax, and similar softwares, will show typical questions and answers on each screen you're working on. For example, if you're working on business deductions related to running business errands, you'll see easy explanations about the tax laws regarding travel mileage. You can also use the help feature in the program. If you want to ask someone directly, you can get answers from specialists using TurboTax's live community of experts.
Stores Taxes on Your Computer
Recordkeeping is important in business. If you're having trouble keeping up with all the paperwork, a tax software can be a great solution. It stores your taxes right on your computer. You can also use a tax software that has an online version to store your taxes on their protected servers. This gives you the ability to access your taxes anywhere, anytime, for any year.
Most tax software will convert the information from your federal return to your state return. You can't do this when filing a paper return. With a paper return, you have to write or type the information twice. A tax software cuts this step in half and gets rid of common errors that occur when copying the information.
When you consider all the benefits of using tax software for filing tax returns, it makes sense to buy one. Make sure you get yearly updates or editions. You should consider using an online version to get automatic updates, and to get online access to your taxes.
Daphne Mallory, Esq. is the co-owner of Mallory Writing Services and has written more than 100 articles helping home based business owners and entrepreneurs start and market their business. You can learn more about her here.