Thanks to the Federal Government
Ready to get that tax refund? You can now do your taxes without having to pay for it.
There are plenty of ways to pay for tax help, but you don’t necessarily have to. The Internal Revenue Service helps millions of people annually file their taxes for free.
The IRS says anyone whose adjusted gross income was $64,000 or less last year is eligible to use Free File software. More than 70 percent of taxpayers are in this bracket. And free doesn’t mean complicated.
“You don’t have to be an expert on taxes. Free File software can help walk you through the steps and help you get it right,” says IRS commissioner John Koskinen. “For 14 years, this partnership between the IRS and the Free File Alliance has helped taxpayers prepare and file their federal taxes for free.”
How to file for free
Free File does most of the legwork for you. If you’re in the 70 percent bracket, all you need is an active email address, your tax return from last year, and anything that has information on your income and deductions, like W-2s. Here’s everything you should have handy before you get started.
Once you’re done, you can opt into getting your money faster by setting up direct deposit. Otherwise you can track your refund after filing to make sure it’s on its way.
While Free File is one of the best and easiest way to file your taxes for free, remember there are a few other places you can get your taxes done without paying for them.
Most free file options also cover state returns. Depending on where you live, you may not need state tax help. Alaska, Florida, Nevada, South Dakota, Texas, Washington, and Wyoming do not have an income tax, so residents here don’t need to file state taxes, only federal.
Are you going to be paying more this year?
A few months ago, Bloomberg’s projected tax rates for 2017 suggested that there will be an increase in penalties for taxpayers who don’t file. They also hinted at lower tax bills.
Last month, the IRS released all the changes to this year’s filing, including:
1. Delayed refunds for some taxpayers — Your refund may be held up because of a new law that says the IRS must hold refunds claiming the Earned Income Tax Credit or the Additional Child Tax Credit until February 15.
Expired Individual Taxpayer Identification Numbers (ITINs) will hold up refunds, too. It can take up to three months to process an ITIN renewal application, the IRS says. Make sure you do that ASAP if yours is expired.
2. Standard mileage rates updated — For work cars, vans, pickups or panel trucks, you can get back 54 cents per mile. This is down 3.5 cents from 2015. Next year, it’ll go down another half a cent.
If you drove for medical or moving purposes, you can get 19 cents per mile, down 4 cents from 2015. Next year it’ll go down another two cents.
3. Olympic medals and prizes now tax-free — For all our award-winning Olympians, including our friend Ryan Lochte, take note. This new tax break qualifies anyone whose AGI was $1 million or less in 2016.
Regardless of your new deductions and increases, make sure you’re all set to file! And make sure you know what your taxes are used for.
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Article last modified on January 17, 2018. Published by Debt.com, LLC . Mobile users may also access the AMP Version: How to Prepare and File Your Taxes for Free - AMP.