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Time Crunch Before April 15? How You Should Prepare Your Taxes

by Wallace Hanson

Spring is one of the happiest times of year, with cool, bright mornings that hold great promise for the warm weather ahead. However, for most individuals, spring can also mark a potentially stormier time -- tax season. As April 15 rolls closer, what should you do if you still don't have your tax return finalized? Should you attempt to prepare your return yourself or by using tax software, or is this instead a matter best left to a professional? Read on to learn more about what you should consider when finishing your taxes at the last minute.

You should likely be able to do your own taxes if:

  • You have only W2 income; and
  • You earn under $100,000 per year; and
  • You don't plan to take any tax credits other than the earned income credit (EIC).

Although the tax code often seems incredibly complex, the 1040-EZ return is a simple two pages. If you have only W2 income, no dependents, and few deductions, you'll likely be able to fill out and file your own tax return simply by following the instructions included with the 1040.

You may want to use tax preparation software if:

  • You earn more than $100,000 per year; or
  • You have business or other 1099 income that is subject to self-employment tax; or
  • You have itemized deductions or multiple credits (like the child tax credit or childcare credit).

If you don't qualify for the 1040-EZ, but have already gathered your relevant tax documents, you'll likely be able to complete your return simply by answering the prompts of tax preparation software. This return can then be electronically filed with the click of a few buttons. As long as your return isn't too complex, you should be able to accurately complete it using third party software.

You may want to use a professional tax preparer if:

  • You have self-employment income, rental income, royalties, or other complex financial holdings; and
  • Your preparer believes a filing extension will be approved.

If you've waited until the last minute to request an appointment with a tax preparer, you may be disappointed to find that slots are booked up through the end of April. However, you should be able to request a filing extension from the IRS, giving you and your preparer additional time to finish your tax return. If your preparer believes your extension request will be approved, this is likely the best option; however, if it is denied, you may want to instead prepare your taxes using at-home software.