Once you’ve learned how to file your tax returns online, you’ll never go back to paper.
Step 1: Gather your papers Locate any forms, statements, and receipts you think may be even remotely relevant to your income, expenses, and deductions. When in doubt, remember that it’s better to have them and not need them, than need them and not have them.
TIP: You can find a complete list of required documentation and other helpful tips at www.irs.gov.
Step 2: Pick your program Start by going to www.irs.gov and selecting one of their authorized e-file providers, or purchase an authorized e-file program at a computer store. Many of the top software applications are quite similar, but you should compare prices and features. Many can also file your state taxes, too.
TIP: If you earn under $54,000 a year, you’re eligible for the government’s Free File program, which lets you e-file for free. Learn more at www.irs.gov.
Step 3: Follow the steps Once you have your documentation handy, load your software and follow the instructions. Don’t worry, they think of everything.
Step 4: Save documents Organize and save all documents as you go so you can hit the ground running next year.
Step 5: Don’t take shortcuts If you encounter errors or red flags when entering your information, do not ignore them. If you can’t fix them on your own, you may have to pony up for some professional advice.
TIP: Many of the online programs offer live advice from tax professionals through their help menus.
Step 6: File away When you have the green light from the online tax program, let ‘er rip—file away! And, by the way, welcome to the 21st century.
FACT: In 2007, 22.5 million Americans filed their taxes from their home computers.