Credit:
TD Ameritrade “The Ticker Tape”

Is it possible to file taxes for free? Yes, it is. This is not a dream.
There are indeed some situations where it makes sense to do your taxes yourself and file those
taxes at no cost. Of course, no two tax returns are the same, and there are times when paying
someone to handle calculating your tax owing or refund might be a better option.
Hans Scheil, certified financial planner and chief executive officer of North Carolina–based
Cardinal Retirement Planning, says taking the free route is a good way to file for people who
have very basic returns.

“I think it’s fine if you have a simple form. If you have W-2 income from a job, and you’re going to use the standard deduction, or even if you list a few simple deductions, I think you’ll be fine,”Scheil says. There are a few ways to file for free. One is to go straight to the Internal Revenue Service website and look for “free file software.” People whose income is below $66,000 can get access to free federal and state return options.
You can also use software like TurboTax Absolute Zero, says Lisa Greene-Lewis, certified
public accountant and tax expert at TurboTax. She says taxpayers who file using forms 1040A or
1040EZ, have a taxable income of $100,000 or less, and take the standard deduction will pay
nothing to file both federal and state returns.
“We use artificial intelligence and machine learning to get our customers a personalized
experience,” she says. “Also new this year for free customers: they can import their prior-year
tax return for free. That also eliminates data entry, because that comes into the tax return.”
Why Pay?
For tax returns that take a little more time, such as itemizing deductions, low-cost software is
available, such as the classic TurboTax Deluxe. TurboTax also has new software designed for
specific industries, such as for people who have rental property or are self-employed, GreeneLewis
says.
Another option is to hire a professional to do your taxes. Scheil and Gregory Hammer, president
of Hammer Financial Group in Northwest Indiana, say one of the biggest reasons to hire a tax
professional to do your taxes is when you’ve had a big life event. Those include marriage, having
children, retiring, a spouse dying, or receiving an inheritance. Such life events can not only
change your tax bracket, but might also require the filing of additional forms.
No matter how you file your taxes, most returns will end up with accurate results, Hammer says.
However, sometimes tax professionals can find lesser-known state credits or deductions that can
help boost refunds.
At tax time, it might be tempting to just consider the current year’s return. But, Hammer says,
working with someone who can help you plan to mitigate future tax bills could be worthwhile. A
planner can look at what you’re doing now and make a few changes that, down the road, can
affect your future tax returns, he says.
“The challenge is whether you’re doing things to change the input to change the output,” he says.

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