5 Reasons to Use Tax Prep Software

I've been doing my own taxes for about 5 years now. Even as my needs have changed (I've gone from a simple 1040EZ to a more complex small business partnership structure), I've found that the tax software available on the commercial market has grown to meet my needs. While many of us DIY'ers love the control we can have over our filing, there are many other valid reasons to giving it a try. With over 36 million people using tax software for last year's taxes, we're convinced it may be a good investment for you, too. Here are the most compelling reasons to break out of your rut and give it a go!

Simple Q & A

Most of us don't get around the table with our buddies and chat about our 1099-DIV's. We may however, share some insight into how much interest our bank accounts have earned. That's because, to be quite honest, most of us don't care about the terms used to describe tax documents and law - but we do care about getting our taxes done right.

Tax software offers us the ability to answer simple, common questions that most any person can understand and can decipher it into "tax-speak" that the IRS can process. It's like having your own translation service for the trickiest of languages. And because most of the questions asked by tax software programs are situational, users can accurately detail their statuses by simply telling it like it is. There's no need to guess what category, form, or line a specific item would appear on.

If you run into a tough problem, some tax software companies offer useful video tutorials, like this video guide on the first-time homebuyer's tax credit:

I grew up in a home where taxes were dreaded for many reasons. In addition to the worry that our small farming operation would owe money to the government at the end of the year, there was also the anxiety that came from stressing about how much the tax office would charge. With tax prep software, it's not only usually more affordable to do some of the most common tax tasks, it's also no surprise when the bill comes. Tax software usually starts out with a free version, and while it offers to "upsell" you to pricier versions that are designed to handle more complex tax codes, you'll know about these pricing changes ahead of time. There should be no shocker on what you'll owe the tax software company. (We just wish we could say the same about the IRS....)

Less Paper, Less Mess

It's quite possible to go almost completely paperless with your taxes. Depending on your tax situation, you may already be getting W-2's or 1099's electronically, using online statements for your spending records, and storing much of your accounting in software-based ledgers. While we always recommend that you back everything up regularly (including credit card statements, which are usually only housed online for up to a year), it can be far less of a headache to shuffle through PDF files and excel spreadsheets than your typical paper monster. Many tax programs will automatically import financial data from major banks, employers, and credit companies, so look into this option if you're totally dedicated to making your tax process a clutter-free experience.

Tax Filing for EVERYONE

Not everyone resides in the heart of a bustling city, near a shopping mall, or even in a 50-mile radius of an independent prep office. For this reason, tax software is an increasingly appealing option for anyone who finds it inconvenient, or altogether impossible, to get in and get the job done. While we know that there are still old-school tax filers who get a rush from making an appointment with their tax attorney or scooping up scads of forms from the local public library, there are many more who would prefer to stay home, save their gas money, and sip some home-brewed coffee while doing their taxes. Preparation software knows no geographical limits, and therefore, is a popular choice for both the busy and the displaced.

Cash in a Flash

Yes, you can go into any tax office, have your taxes done, and get your refund to you within a few weeks via the e-file and direct deposit options. For those who want their refund to come lightning fast, however, it may just be quicker to do it yourself. With online and out-of-the-box software solutions making it so easy to file for a refund, you can realistically do your taxes in just a few hours, file the same day, and see a large windfall to your checking account within 2-3 weeks. While some tax offices can deliver on equally speedy promises, having control over your own filing process will give some anxious tax payers some relief - and will guarantee the quickest return of your money (provided there are no errors, of course.)

In addition to all the reasons WE love tax preparation software, here are a few nuggets of goodness from experts in the field:

• The automation, carry-through and other features of using software over pencil and paper are enormous. Filers save a great deal of time because they're not painstakingly carrying figures from one form or column to another, transposing figures or otherwise committing errors that may cause them to overpay, or worse, trigger an audit. - Ben Pearman, Pearman & Co.
  
  
• Do-it-yourself programs should be considered by anyone who likes to feel connected to their personal finances, enjoys a sense of accomplishment from completing taxes or uses tax preparation to update personal and business budgets for the year. - Julie Markey, HR Block at Home
  
  
• The average time to prepare a return.... is about 2 hours. And you can do it on your own schedule - whether it's after the kids are in bed or while you're watching late-night TV. People who make the switch to tax software do so because they're done with the long lines, repeat visits and delayed appointments. - Ashley Kirkendall, TurboTax
  
  
  [Headline Photo Credit: Morgan Lane]