With the beginning of the New Year comes income tax season—that time between late January and April 15 when almost all American households have to file a tax return. It’s not too early to get a grip on your taxes.
Solutions for filing your taxes
Around this time of year, you’ll see lots of advertisements and information about tax preparation and tax filing services. Here are some facts to help you sort through your options.
Get help with your taxes for free
- If your income is $52,000 or less, you can get free tax preparation assistance at a Volunteer Income Tax Assistance (VITA) location near you.
- If your income is $58,000 or less and you’re age 60 or older, free tax preparation assistance is available through Tax Counseling for the Elderly. Find a location near you.
- Ask a friend or search online to see if free tax preparation assistance is offered at other places in your area (for example, at community centers, churches, or clubs).
Do it yourself
- You can file your own tax return, on paper or electronically.
- You can file online for free with the IRS.
- If your income is $58,000 or less, you can use free tax preparation software from the IRS.
Not sure you need to file at all?
Depending on your age, income, and filing status, you might not technically be required to file a return. It might still be a good idea to file, though. You might receive a tax refund, or you might be eligible for tax credits. The IRS has guidance to help you decide whether you need to file.
Take care of your tax refund, so it can take care of you
Ads on TV and radio may be tempting, claiming to get your tax refund money the next day, or even before you file your taxes. But these offers can be expensive. Here are some ways to make the most of your refund.
- Use direct deposit. If possible, file your return electronically and have your refund direct-deposited into your bank or credit union account. The IRS issues most refunds within 21 days, often less—with no fees or charges. You can even keep track of your refund’s progress online.
- Avoid tax refund advances. When a company promises a faster refund, they’re not actually getting your money from the IRS faster than you can. Instead, they’re lending you the money, and they’ll charge you for the loan. With direct deposit, you can get your full refund, usually within 21 days.
- Pay your tax preparer up front. If you decide to use a paid tax preparer, the person may offer to take their fee out of your refund. This may seem convenient, but it can have a high cost. For example, if the fee for tax preparation is $200, they might tack on a $30 charge for the convenience of paying the fee out of your refund in a couple weeks. The $30 advance on a $200 purchase is like a loan with an annual percentage rate (APR) of 260 percent.
- Save some of your refund. It’s free, easy, and fast to put some of your refund into savings when you file your tax return. Include your savings account information when you file yourself, or bring the information with you when you see a tax preparer. Once you’re done, check out SaveYourRefund —some nonprofits offer added incentives for saving.
Does your organization provide services to taxpayers?
We’re partnering with a number of VITA sites on a “Ready? Set. Save!” campaign. If your organization helps people prepare their taxes, you can download the Ready? Set, Save! materials and use them this tax season: