It is more popular than ever for people to manage their own finances with personal tax software throughout the year and, most importantly, during tax season. There are many options, both free and pay-to-use, with yearly updates and a variety of interfaces. Here are some guidelines to help you select the right type of tax preparation software:
INSTALL OR ONLINE
Generally personal income tax software comes in two forms: a program installed on a computer or an interactive online system. Installed programs have the advantage of being accessible for year-round financial management, though they often cost more than their online counterparts. Online systems do not take up any space on your computer, but they do require a constant internet connection while in-use. Additionally, choose a program that is compatible with your operating system (ie: Windows or Mac).
NUMBERS OR WORDS
Before you make a purchase, evaluate and compare the data-entry methods of any potential income tax preparation programs. While many offer the cut-and-dry process of filling in numbered boxes, some services present a more streamlined, “interview”-style approach to collecting your information. In either case, all calculations are done for you and are easy to review. Consider your preference carefully when selecting your tax preparation software.
KNOW YOUR NEEDS
Premium tax software at a higher price has no impact on the quality of your tax return. Research your own requirements before you settle on which personal income tax software is right for you. If you are filing for a single income, without kids or any considerable assets, there is no reason to spend extra money on high-end software. Conversely, if you a have a complex return that includes things like rental property or foreign income, most low-cost or free software will not be sophisticated enough to generate a proper income tax return.
Still have questions? Contact the team at Liu & Associates!