Still not sure if you should try to file your own taxes this year?
Here’s 5 of the most common DIY tax filing myths and the reasons why they simply aren’t true.
Myth 1: I don’t know much about taxes, so I might miss deductions and credits if I do my own taxes.
Fact: A tax preparer asks standard questions and asks for additional information as he or she sees fit. Online tax software does the same thing.
Tax software developers and accountants design the Q&A interview in the software with the right questions to make sure you’re getting all the tax breaks to which you are entitled.
In fact, you may find new tax breaks or benefits you’ve never heard of by using tax software.
For example, the software may ask if you paid educational expenses for yourself, your spouse, or a dependent.
If you did, the program will help you decide which educational credit or deduction you may qualify for based on your complete tax situation.
Tax professionals know a lot about taxes, but no one knows as much about your financial situation as you do.
When you combine your knowledge of your own finances with the expertise built into the tax software, you can have confidence your return is prepared and filed accurately.
Myth 2: Doing my own taxes sounds difficult and complicated.
Fact: Online tax software is no harder to use than most online shopping platforms or other processes you perform online every day.
In fact, it may even be easier.
If you follow the step-by-step interview, preparing and filing your taxes is as easy as answering one question at a time.
The tax software takes care of all the hard stuff for you.
Myth 3: Tax software asks questions that have nothing to do with my situation.
Fact: The questions you answer in a tax software program are determined by your answers to previous questions.
If you don’t have interest income this year, you won’t hear more about it.
If you have a very simple return, the program determines exactly what you need with minimum questions.
Myth 4: It’s easier to use a tax preparer and let someone else do all the work.
Fact: For many people, the hardest part of preparing a tax return is gathering the information.
If you track your financial information all year and carefully organize your tax documents, you’ve already tackled one of the biggest steps. And if you haven’t, you still have to put it together at tax time. No one else can do that for you.
By the time you hand off your information to a tax professional, you’ve already done the hard part and may be surprised how little effort it takes to finish the job.
Myth 5: I’m afraid I’ll get audited if I use tax software.
Fact: The chances of being audited are very low in any particular year.
As a general rule, your chances of being audited are greater if you make a very high income – typically a million dollars or more.
With tax software, the odds of being audited can actually be reduced. That’s because tax software helps you catch potential mistakes.
For example, the software asks questions to help determine if you meet all the qualifications for various tax breaks. It will also scan your return as you finish to ensure no mistakes were made along the way.
In addition, you can’t make math mistakes because the software will do all of the calculations for you.