Tax Advice: File Now or Pay for it Later
NO CREDIT LEFT BEHIND: TO-DOS FOR TAX SEASON 2012
Monday, March 7, 2011
As April approaches, many citizens begin to dread the hassle of tax season. While major reforms are out of the taxpayer’s control, staying informed and using a tax preparation service are two simple ways to make filing your taxes as stress-free as can be.
“Stay informed and you won’t leave money on the table,” says Saint Joseph's University professor and former IRS agent Dennis Raible, C.P.A. “There are broad deductions that apply to many people,” he says. “Tax credits and deductions run the gamut from childcare costs — if they enable an individual to go to work — to energy savings credits for approved windows, doors, or energy-efficient heaters.”
Raible also cites the American Opportunity Tax Credit and the Lifetime Learning Credit as two opportunities to alleviate the cost of higher education. Other ways to earn a break include charitable contributions, retirement planning and logging mileage — whether it is for a personal business, commute or a job search.
A good way to stay on top of what claims and deductions are available is to use a tax preparation service. “TurboTax,” says Raible, “is a wonderful program for individuals preparing their own taxes. It is user-friendly, menu driven and very intuitive. It asks the right questions to help users find deductions.” Other do-it-yourself services include TaxACT, H&R Block and e-Smarttax. Some are free while others require the user to pay a nominal fee each year.
Taxpayers who opt to have their taxes prepared by a professional can expect to spend upwards of $150 to $250 dollars. For seniors and taxpayers with a low income, free professional tax preparation services are offered. “Services like Volunteer Income Tax Assistance (VITA),” says Raible, “are in place to help the people who often depend on a tax refund, but can least afford the tax preparation fees.”
Saint Joseph’s VITA program, ran in cooperation with the IRS and the Pa. Department of Revenue, is offered during the Spring Semester of each Academic Year. The program trains Saint Joseph’s students in tax return preparation and then allows them to connect with members of the community who are in need of their services.
“Tax reform comes very slowly if it comes at all,” says Raible, “so taxpayers need to take advantage of the different ways they can make tax season easier for themselves.