You now have several choices in filing your federal income taxes, and many of them are free. The Treasury Department, Office of Management and Budget and the Internal Revenue Service have launched a new Web site featuring private-sector partnerships that will allow most taxpayers to prepare and file their taxes online at no cost at www.irs.gov or through www.firstgov.gov.
President Bush proposed free online tax filing last February as one of his E-Government initiatives. Now, the plan is being offered to the public.
"Simply paying taxes is burden enough without the extra costs in time and professional help that too many Americans have endured until now. The advent of free, fast filing for a substantial majority of taxpayers marks a great breakthrough for the President's agenda to make the federal government put the needs of the citizen first," said Mitchell E. Daniels Jr., director of the OMB.
E-filing is expected to go over well with Tennessee taxpayers.
"E-filing is fast, easy and accurate, and for thousands of Tennesseans this year, Free File makes it even more attractive," said Dan Boone, IRS spokesman.
"We see it all the time. Once people try e-filing, they usually never go back to paper returns," Boone said. "Free File may encourage more people than ever to make that switch."
The IRS estimates that more than 1.56 million returns from Tennessee will be eligible to be filed online through Free File this year. In 2002, approximately 1.19 million federal income tax returns were filed electronically by Tennesseans, but only about 184,000 of those were self-prepared and filed online. Most of the rest were e-filed through paid tax preparers.
However, using a tax preparer may not be worth the cost.
A study released last week found that a federal tax credit aimed at the working poor helped many families pay bills in 2000, but it also helped line the pockets of tax preparers.
The survey by the Brookings Institution praised the success of the Earned Income Tax Credit, which Congress established for low-income residents in 1975. But it found that tax preparers were gouging taxpayers for as much as $200 apiece to receive the refunds instantly, rather than a few weeks later.
Marilyn Day, coordinator with Clarksville's Volunteer Income Tax Assistance, said tax preparers can charge up to 25 percent to process your return and make you a next-day loan.
"You end up getting less money back," she said. "E-files are free with refunds received in approximately 10 days if direct deposited or three weeks if a check is mailed."
If you want someone to prepare your taxes, you can have Day and her group of volunteer tax preparers do it for free at the Clarksville-Montgomery County Library on Saturdays from 1 to 4 p.m. and Thursdays from 5 to 7 p.m. through April 12.
The service is available to married couples making $70,000 or less and singles making $50,000 or less.
If you go, be sure to take with you:
- All 2002 tax documents (W2s, 1099s, etc.).
- All Social Security numbers.
- Child care expense documents.
- Tuition and fees expense documents.
- Student loan interest documents.
- A blank check, if you want refund direct deposited.
Quelle: The Leaf Chronicle
