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Plan Well, Retire Well

Saving and investing your money
taxes-646511 1920

Stressing about Taxes? Survival Steps!


When the Tax Cuts and Jobs Act of 2017 passed, I thought it might be a little extra stressful to prepare my tax return for 2018 with all the different changes. Well, now tax filing time is here and the number crunching begins! Let's look at steps you can take to reduce tax filing stress.

Before you pull out a calculator or login in to a tax return preparation program, take time to gather all your documents. Whether you receive tax-related documents in print or electronically, start gathering them into one place. I like to use a folder where I can quickly place documents as soon as I receive them. It's much less stressful for me if I can find the documents I need, when I need them.

The tax return forms look a little different this year. Form 1040 has been redesigned; when I downloaded it from the IRS website it looks like a large postcard (about the size of a half a sheet of paper). For past users of Form 1040A or 1040EZ, you will now use Form 1040. Some people also will need to use Schedule 1 – 6 to provide all needed information. The IRS does have a nice overview of the new Form 1040.

If you prefer to prepare your tax return online or with a software program, how the form looks probably won't matter to you. Whether you choose a software or online program or a professional to prepare your taxes, take time to choose a service that meets your needs – and one you're comfortable with. Compare costs as well. Read these suggestions about how to choose a tax professional,

If your financial situation is relatively simple, you may find using an online program both meet your needs and is inexpensive. For example, United Way collaborated with H&R Block to provide access to tax software online that allows you to file both federal and state taxes for free. MyFreeTaxes.com is completely free (including if you file in multiple states, work freelance, have a side gig, or earn investment income) for individuals and families who earned less than $66,000 in 2018. If you have questions, IRS-certified specialists are ready to answer questions in real-time.

In addition, if your 2018 adjusted gross income was $66,000 or less, you will find more free online software options available through Free File at IRS.gov. Review each company's offer to make sure you qualify for your free federal return. Some companies offer free, state tax returns; some charge a fee.

Another option to consider is to go to a free tax preparation site. The IRS has two volunteer-certified programs that provide free tax preparation services: the VITA (Volunteer Income Tax Assistance) program and the TCE (Tax Counseling for the Elderly) program. TCE is often supported by the AARP's Foundation's Tax Aide program. Each program has its own rules about who qualifies for free assistance. Typically you need an appointment to receive assistance. To find a program nearby, go to IRS's website at www.irs.gov/vita.

One more step before you begin. Be sure to explore whether you qualify for a tax credit. Tax credits are especially nice because the amount of the credit is deducted from your tax obligation and, in some cases, may result in a tax refund.

The most impactful tax credit tends to be the Earned Income Tax Credit. If a person earns$54,884 or less in 2018, then they should check if they qualify. Use the EITC Assistant to see if you qualify

People with children under the age of 17 or with other dependents should check if they qualify for a Child Tax Credit. Lower-income people who are saving money in a retirement or ABLE account should investigate the Savers Credit. Go to https://www.irs.gov/credits-deductions-for-individuals for more information about these and other credits.

Approach tax preparation in small steps. Gather your documents. Choose your tax preparation program or professional, and explore tax credits. You're almost there! Good luck with your tax filing for 2018.



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