How Can You Save Money During Tax Time? It’s “EZ” – File the Return Yourself or Use FREE Resources
By Mikki Venekamp, AFC®
I used to see the tax preparation company commercials on TV and think I should go into one of those places to get the “maximum refund.” It wasn't until I took a tax preparation course and actually worked for a nationally recognized tax firm for a few years that I realized all tax preparers are following the same tax codes, so how on earth can a tax professional who works at a tax firm can get you more money back than if you file the return yourself following the exact same tax rules?
But even before I took the course, I was doing my own tax returns. And what I am going to tell you is there is no magic formula that can “get you the maximum refund”! For service members and their family members, the easiest way to save during tax season is to keep their hard-earned money in their own pockets. Instead of paying high-priced tax preparation fees, they can file their return for FREE through the local VITA site on many military installations, via the IRS website, or through Military OneSource.
FREE is always in your budget, so why not utilize one of the above for this tax season? For those who have W-2s and couple of 1099-INT forms, I am pretty confident that you are capable of doing your tax return on your own by utilizing the e-file software offered by Military OneSource or the IRS website.
Military OneSource uses H & R Block at Home software for e-filing. The program guides you through the filing process and even checks to make sure that you haven’t left off important information or valuable deductions. Military OneSource also has a toll free number (1-800-342-9647) where you can access trained tax counselors 7 days a week, from 7 am to 11 pm.
On the other hand, for those who have complicated returns (rental property, capital gains, farm income etc.); I would recommend visiting your local VITA site on base/post. If you are not near any military installations, please visit the IRS website and you should be able to locate a local VITA site that is close to your residence. Local VITA sites have trained volunteers to prepare your return for you at NO COST and please advise the person who is doing your intake that you are with the armed forces so they can send you to the right tax professional that is certified to prepare military returns. The VITA Program generally offers free tax help to people who make $51,000 or less and need assistance in preparing their own tax returns.
If you do insist on going to one of those tax preparation firms, please be aware of the tax preparation costs plus any additional products that they are going to offer you. One common product that these firms offer would be no preparation fee up front if you sign up for a tax refund option, like a Refund Anticipation Check (RAC). But there is a price tag attached to this option: in addition to the tax preparation fees, there are additional fees and interest that will be deducted from the refund amount before it is deposited in your account.
And if you are getting a refund, you may consider saving part of it by utilizing IRS Form 8888, which allows filers to allocate their refund to go to different accounts or toward the purchase of savings bonds for themselves, their spouse, or even as a gift for someone else.
For more information:
Kickstart Your Savings: Have a Plan for Your Refund
Savvy Allocation of Your Tax Refund
Grow Your Tax Refund With Savings Bonds
- Written by Guest Blogger
- Category: Blog
- Published: 07 January 2014