The Best Free Resources For Tax Season
It is officially 2011. Is your tax return squared away yet? If you’re like many of us, the answer is probably no. It’s a burdensome, annoying and sometimes confusing process. But this year, it doesn’t have to be. By taking advantage of some helpful online resources, you can tackle tax-related challenges with painless ease. Skip the costly trip to the tax store, save some money and solve your tax problems using the free TurboTax Online Free Edition to file your taxes for free if you have a fairly simple return (i.e. you file a 1040 or 1040EZ). Use these web-based tools and calculators discussed below to kick off your tax planning for free:
Taxes are all about numbers, and when they start adding up, keeping track can be confusing. To combat this problem, TurboTax offers a number of free, web-based resources and calculators for such things as:
- Estimating your 2011 tax refund
- Projecting the tax implications of major life changes
- IRA contributions and their tax consequences
This same webpage also offers how-to videos and step-by-step article tutorials on topics like reducing tax return errors, child tax credits and more. Whether you’re trying to perform specific calculations or simply educate yourself on general tax topics, chances are you’ll find what you need in our resource center.
SmartMoney Capital Gains Tax Estimator
Investors must pay not only income tax – like the rest of us – but also a separate tax called capital gains tax. There are actually two rates:
- Long-term capital gains (on assets held longer than one year)
- Short-term capital gains (on assets held for one year)
For investors with large, diversified portfolios, calculating exactly how much tax is owed can become quite daunting. Thanks to SmartMoney’s capital gains tax calculator, it doesn’t have to be. Rather than guessing about numbers or wondering how your tax filing status fits into the equation, the calculator asks you for all the relevant information and tells you in black and white terms what to pay.
IRS Withholding Calculator
It happens every year: people get huge tax refunds and celebrate their unexpected windfall. Suddenly they can take that vacation or pay off that pesky credit card bill. Exciting as this may be, it’s important to realize exactly what takes place when you get a big refund check. This is not “free” money that simply fell out of the clouds – rather, it is your money that you, in effect, lent to the IRS all year long without receiving any interest.
True, some people would rather get the lump sum anyway (as sort of a forced savings plan) but not everyone prefers this option. The best way to prevent it from happening is by adjusting your W-4 withholding form at work, which this free IRS calculator helps you do.
Bankrate Estate Planning Calculator
Estate planning may not be a pressing matter for you before April 15, but it always pays to get a head start. Unfortunately, as with capital gains, figuring out estate planning issues is very number heavy – in fact, much more so. Trying to juggle all of the different variables in your head (gift allowances, insurance policies, asset values, etc.) is virtually impossible and bound to produce errors.
That’s why Bankrate’s estate planning calculator is such a handy tool. While it’s not a quick process, you can be confident upon clicking “Calculate” that every relevant variable is reflected in the answers this calculator generates. What was once a hazy mess of numbers and “what if” scenarios will be reduced to a manageable task.
Kiplinger Tax Burden Estimator
Ever wonder how much of the tax burden you are individually responsible for? Kiplinger’s tax burden estimator will tell you. Simply type in your adjusted gross income from last year (line 37 if you used the Form 1040, line 21 on Form 1040A or line 4 on the 1040-EZ) and press “Submit.” In seconds, the calculator will tell you what percentage of income earners you belong to, the percentage of total income taxes your group paid, and roughly how many people belong to that same group.
You can also type in in different income amounts to estimate how changes in your income will change your relationship to the tax burden.
Forbes Top 10 Missed Deductions
We all think we know the tax deductions available to us, but a surprising number of us miss out on big savings. Forbes, for instance, reported that “nearly one million people fail to itemize mortgage interest, resulting in an overpayment of $473 million” according to an early 2000’s study. In the same article, Forbes summarizes the top ten most missed tax deductions with plain English explanations and powerful reminders to take advantage.
Of course, keep in mind that free online tax filing will automatically analyze your return and alert you to every single deduction that you can legally take advantage of in 2011. From now till the end of January, 2011, a tax expert will answer your tax question for free. Just visit http://www.freetaxquestion.com.