Do You File Your Taxes Electronically?

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One more day, procrastinators. And we say that with a smirk, since we just finished filing our own Fed and states taxes online. We don’t know how our parents did it the old fashioned way with pen, calculator and lots of coffee, but we think preparing and/or filing electronically is the greatest thing since sliced bread, reducing a great deal of the stress involved with filing annual taxes. We’ve used Turbo Tax’s online service for the last couple of years with positive experience (note that the IRS is now opening up Free File Fillable Forms so anyone can file free, even if you make over $56,000), though we still like to print, pay and mail out our forms the old fashioned away after we’re all finished preparing online. How about you out there? File via website? Software? Paper, pen and abacus? Below are a few tips to make your Tax Day an easier one if you’ve been holding it off till the last possible second…

File Electronically
Taxpayers can take advantage of e-filing, which is fast, accurate and easy. Most available tax preparation programs check for errors and necessary information, increasing the accuracy of the return and reducing the need for correspondence with the IRS to clarify errors or omissions. With most programs, taxpayers can usually file a state tax return at the same time they electronically file their federal return. Once the return is accepted for processing, the IRS electronically acknowledges receipt of the return. Generally, when someone files electronically, their refund will be issued in about half the time it would take if they had filed a paper return. Those who choose direct deposit will get their refund in even less time.

Use IRS Free File
Free electronic filing from nearly 20 companies is available to taxpayers whose 2008 adjusted gross income was $56,000 or less. That means 70 percent of all taxpayers, or 98 million filers, can take advantage of the IRS-sponsored Free File program. The only way to access this program is through this Web site. There is no charge for this service.

This year, the IRS and its partners are offering a new option, Free File Fillable Forms, which opens up Free File to virtually everyone, even those whose incomes exceed $56,000.

Free File Fillable Forms allow taxpayers to fill out and file their tax forms electronically, just as they would on paper. It allows taxpayers to enter their tax data, perform basic math calculations, sign electronically, print their returns for recordkeeping and e-file their returns. This option may be right for those who are comfortable with the tax law, know what forms they want to use or don’t need assistance to complete their returns.

Choose Direct Deposit
Whether filing electronically or on paper, taxpayers can opt to have their federal tax refund deposited directly into their bank account. Taxpayers who choose direct deposit will get their refunds faster than those who receive a paper check. Taxpayers who both e-file and use direct deposit will receive their refunds even faster. And, a refund that is directly deposited in a savings or checking account cannot be stolen or lost in the mail.

Using direct deposit is easy. Paper return filers just enter bank account and routing numbers in the boxes provided on Form 1040, 1040A or 1040EZ.