The Best Tax Site You’d Never Expect
Procrastinate all you want, but tax season won’t go away. Instead, get your paperwork in order now, and read up on tax breaks and strategies that can lower your ultimate bill. Plenty of websites can help you, but the most useful belongs to the IRS itself, at www.irs.gov. (Remember, that’s .gov, not «irs.com» or any other variation.)
The horse’s mouth
At the IRS website, you can take care of lots of business for free, without waiting in line or on hold. All IRS forms and publications are available free on the website for you to read, download, or print.
You can also read up on the latest in tax-law changes. For example, beginning in 2011, you can’t pay for non-prescription over-the-counter medications (excluding insulin) via your Flexible Spending Arrangements, more commonly known as flex plans. But claims for such expenses incurred in 2010 can still be processed and reimbursed in 2011.
At the IRS’s website, you can calculate your optimal withholding amount for your W-4 form, and answer a few more questions to determine whether you qualify for the Earned Income Tax Credit.
Click into the Interactive Tax Assistant nook, and you can figure out what your filing status should be, whether you’re eligible for key tax credits, or even whether you should file a tax return in the first place.
Convenience and lower costs
If you’re daunted by the thought of preparing your tax return by hand, or paying someone else to do so, you may have another option. At the IRS website, you can use the service’s «Free File » program to prepare your taxes. Various software packages are free for those with AGI (adjusted gross income) of $58,000 or less.
Once you’re done, you can «e-file» your taxes with the IRS on its website. That’s how more than 70% of taxpayers are now paying their taxes. Sign up for direct deposit, and you can get your refund in just a few days. (You can also track the status of your refund at the IRS website.) E-filing will save you a bit of postage, and it saves us citizens even more: The IRS says an e-filed return costs it $0.19, as opposed to $3.29 for processing a paper return. In the past year, e-filing helped the IRS save more than $26 million. (We can only hope they’ll eventually pass the savings on to us.)
If you’re having trouble coming up with the payment you owe, click over to the website’s Online Payment Agreement Application to see whether you can arrange to pay by installments.
Bigger and better
Good websites have the power of scale, able to easily serve millions. The IRS website drew 239 million visits in 2010, delivering 157 million downloads and handling 277 million searches. There’s always room for improvement, though. The Government Accountability Office (GAO) recently found that only 73% of visitors found what they were looking for. Look for a new, better website in the coming years, as the IRS spends $320 million on a new tax-return-filing system for 2013.
That’s right — if anything, the IRS website could soon make paying your taxes even easier and less frustrating than it already does.
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Longtime Fool contributor Selena Maranjian does not own shares of any companies mentioned in this article. The Motley Fool is Fools writing for Fools.