Top ten reasons to prepare your taxes online and efile in 2008

Posted by Joe on February 18th, 2008

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Preparing and filing your taxes can be stressful and confusing.   But, many reputable companies provide online tax preparation and efile services that will take much of the complexity and worry out of preparing your tax returns.

There are many reasons to use an online tax preparation service.  Below are ten of the most compelling benefits of online tax preparation and efiling.

1. Many online tax preparation services offer free or discounted Federal tax returns.  This is particularly beneficial if you live in tax-free states such as Washington, Nevada, Alaska, Texas, Florida, South Dakota or Wyoming.
2. Customized filing of specific returns from every state are available from most online tax preparation services.  Every state has different tax rules, deductions and procedures.  Online tax preparation services can help you navigate the specific of your state tax return.
3. Online tax preparation services have access to the most recent IRS forms.  Whether you just need a simple 1040ez or have complex itemized deductions on a full 1040 form, you will be able to find the right tax return for your situation through online tax preparation.
4. Most online tax preparation and filing services include deduction maximization features that will help you identify items that could increase your tax refund or reduce your tax payment.  Tax preparation service H&R Block estimates over $800 million in tax benefits go unclaimed because consumers are unaware of their eligibility for certain tax credits.
5. Online tax preparation allows you to complete your tax returns at your pace.  Most online tax preparation services let you save your tax return in progress and comeback later without losing your previous work.  This is particularly useful if you want to work on your taxes in multiple locations, such as home and work, or if you realize you don’t have immediate access to important tax documents while you are completing your taxes.
6. Qualified experts are available to help you complete your tax return online.  All major tax preparation services offer some level support in completing your tax returns.  This ranges from email support to live chat to phone based consultations with tax professionals.
7. Efile, or electronic filing of your tax return, is much quicker than mailing your paper returns to the IRS.  This means that those consumers who anticipate a tax refund will receive it significantly quicker through an efiled return than through traditional postal mail filing of their taxes.  According to the IRS 57.4% of all tax returns, or nearly 80 million tax returns, were efiled in 2007.
8. Not comfortable with efiling your taxes?  That’s OK because most online tax preparation services will allow you to prepare your taxes online and print out the completed returns.  You can simply mail these paper returns directly to the IRS where they will be processed as usual.  In many cases, you can prepare and print your tax returns for free.
9. Can’t wait for your tax refund?  Most online tax preparation services will not only efile your 2007 tax returns but will also provide you with refund anticipatory loans.  These tax refund loans will give you expedited access to funds in the amount of your anticipated tax refund (less any processing and other fees which vary by provider).
10. The IRS is auditing more tax returns than ever.  Recent IRS data showed that about 1.25 million tax returns were audited in 2005 which represented a 21% increase in tax audits over the previous year.  Many online tax preparation services offer audit protection for your efiled tax returns.  This means they will provide assistance if your tax returns are audited by the IRS.

To learn more about online tax preparation services visit the free online tax preparation and efile guide at NextAdvisor.com.

• Save time, money and hassle with online tax preparation
• IRS says early filers prefer e-file
• USA Today selects TurboTax as top online tax preparation service
• $800 million in tax benefits go unclaimed
• Economic stimulus and your 2007 tax return