What happens if there are errors in my taxes because of the Tax Software?
Good tax software companies offer guarantees if this situation occurs. Many times if you are fined because of an error, the software company will reimburse you if they are at fault. And if you are audited, most companies have tax specialists who are able to answer your questions and help you prepare for your audit free of charge. Make sure you look for these guarantees before purchasing tax software.
Can I prepare my own taxes?
Absolutely, though this is not recommended unless you are a professional, have experience doing this on your own, or are ready to sit down and do some extensive studying. The IRS does not make filing taxes on your own easy, and the fear of being audited due to errors during tax preparation is often a big incentive to pay the money for professional support.
Can I reuse my Tax Software next year?
No, unfortunately you can’t. Every year tax laws change, and every year tax software is updated to be compliant with these laws. Additionally, the IRS requires you to use their forms for the filing year. So, if you were to use your software from last year for this years tax filings, your filing will likely be rejected or be accidentally filed as last years taxes causing confusion with the IRS (which could also result in fines for this years taxes). And let’s face it, nobody wants to have to deal with the IRS more than they already have to.
What are the advantages of using Tax Software?
One of the biggest advantages of using Tax Software is the cost. If you hire a tax professional you may be looking at a bill upwards of $100, and a CPA will likely charge you twice that, if not more, for the most basic tax filings. Tax software, on the other hand, costs around $20-120, for both state and federal filing.
Another benefit is speed. Once you have all the documents, most people find they are able to complete their taxes within an hour, whereas, it can take up to a few weeks for a professional to do it for you.
Last, good tax software is simple, and will walk you through the preparation process quickly, especially if your taxes are straight forward. Additionally, many companies offer support for software users who find themselves with questions during the process.