The April 15th deadline for filing federal taxes is fast approaching. Here are five tips to help you start filing your personal tax return and receive help if you need it:
Tip #1 – Know Your Tax Status
Your filing status has a lot of influence over what you pay in taxes and what you could receive in refunds. Make sure you file correctly when indicating if you are single, head of a household, a widow/widower, a dependent, married or filing jointly. If you’re confused or uncertain, you can visit the IRS website to determine your filing status. In addition, keep in mind that your status can affect your marginal tax rate for 2012.
Tip #2 – If Filing Late, File an Extension
If you’re running a bit behind on organizing your taxes, you can use Form 4868 and for those residing within the United States, your filing date will be extended by six months. You’ll have to fill out and send the form in by April 15th, 2013 and provide an estimate for your 2012 taxes, but that extra time can help you organize and maximize your return. Do note that you will owe interest on tax not paid by the April 15th deadline.
Tip #3 – Use E-filing for Easier Filing
There are a few advantages to e-filing your tax return. For example it processes quicker, meaning refunds are typically mailed to you in under 21 days. You can also set up a direct deposit for the fastest return and have the refund deposited in more than one account if necessary. Additionally, the IRS’s Free File tax software is free for those earning under $57,000. You can also submit an e-file through commercial tax software like TurboTax and HR Block or you can use a professional tax preparer.
Tip #4 – Get Help From a Qualified Tax Preparer
If you need help from a professional tax preparer, be sure to ask for his Preparer Tax Identification Number (PTIN) which all tax preparers are required to have. Avoid preparers who want to take a percentage of your refund as payment and make sure that all your refunds are deposited into an account you control. Never deposit refunds into a preparer’s account, and never sign a blank return form. Be sure to have receipts and records ready since they can help the preparer figure out your qualifications for deductions and tax credits.
Tip #5 – Take Advantage of the VITA and TCE Programs
Don’t make a lot of money? Don’t worry, the IRS provides free tax help in the form of programs like VITA for those making under $51,000 annually, or TCE for those over the age of 60. You will receive help from trained volunteers and the IRS page links you to a locator where you can type in your zip code for a location near you where you can get this help.
By Neda Jafarzadeh, a financial analyst with NerdWallet Investing. NerdWallet Investing helps investors compare total costs to find the best stockbroker.