Let’s see… elaborate April Fool’s day prank involving fake job offer for roommate: check. Annual passive-aggressive spring cleaning e-mail to roommates on the state of the dishes in the sink: check. Last year’s jeans turned into this-year’s cut-offs: check. What else are we forgetting about in Apri… ah gad, taxes! And just one week left!
Have no fear, because you wanna know the big secret about taxes? They’re actually kind of a snap to do by yourself, so long as you don’t have a home, large family or stakes in several multi-national corporations. And there are plenty of places that will help you for free. We talked to a few attorneys and put together some last-minute tax resources to help you and Uncle Sam continue your cease-fire relationship.
DIY
If you just have a simple tax return and a computer (which we’re betting you do), our experts recommend filing a free 1040 from the IRS Web site. There’s no income limit for the free filing, but filing your state return usually costs extra money.
Packages like the TurboTax Deluxe are user-friendly, but they tag on an extra charge of about $50. Buying a software package in a store doesn’t really offer any value above doing it for free on the IRS site, one attorney told us.
File on time: Especially if you owe, because you could end up owing more if you’re late. If you don’t have your stuff together, file an extension form 4868. Don’t rush and do a bad job on your taxes.
Don’t be EZ: One attorney says “never file a 1040 EZ. EZ means you didn’t deduct anything, which means you left money on the table.” Did you go without health insurance this year? Those medical expenses may be deductible, and you’d be missing out by taking the EZ road.
Deduct, deduct, deduct: Moving expenses, health care, college tuition, that new car you bought, those alimony payments you’re making… it’s all deductible. Read over this list to make sure you’re not missing any deductions. If you’re freelance or work from home, definitely deduct for office in the home (25% of your rent and utilities).
Here’s a good tax resource, with a deduction checklist, for writers, artists, musicians and other creative folks.
Get organized: Stay in a night or two (your wallet needs the rest anyway) and go through your bank statements, credit card bills and receipts, and put them into simple categories (travel, computer, cell phone, business meals). Tally them up. Whether you do them yourself or have someone else do it, you need it for your deductions. Here’s a list of some of the categories of purchases you should keep track of.
Start right now to be better organized for next year: get a shoe box for your receipts, get a credit card for business and buy everything for business on that card (at the end of the year you’ll only need to look at twelve pieces of paper to tally up your expenses; your monthly credit card bills count as itemized receipts).
HIRING SOMEONE ELSE
Be wary of store-fronts: One attorney advises us that far too many people (friends, neighbors, people dressed in Statue of Liberty costumes) claim they are tax “experts,” so ask a few tough questions. If you’re an artist, ask them if they know what QPA is (qualified performing artist, a special tax category that lets you deduct more). If you’re a small business, or sole proprietor, ask the person offering to help you if they’ll be filing a schedule C. If you have lots of jobs (some W2, some 1099) ask them if they’ll be filing a 2016 and a schedule C. If you get a blank look, you are at the wrong place. All the cheap tax people are just that—cheap.
One attorney advises that those places are basically tax return mills. “The people doing the taxes have probably had a ten hour class teaching them how to use the tax program,” the attorney says. Most people can do their taxes on their own better than the Statue-of-Liberty types
Go pro: If you want to pay for a proper tax preparer (aka someone whose job it is to know what they’re doing), you should expect to pay $300-$400. The attorneys say: in most cases, they pay for themselves by getting you a fatter return. How do you know if you should go to a pro? Anyone who is an artist, sole proprietor or has numerous non-reimbursed expenses for work (home computer, cell phone, etc.) should consider going to someone who knows a bit about how to write things off.
Just say no to refund loans: If you go to a tax service that offers refund anticipation loans, don’t take one. Tell them to E-file and that you will wait on your refund. You should have your refund in two weeks by mail, or can get it direct deposited sooner, and the loans will cost you money in the long run.
Still need help? Here’s a partial list of places you can go for free help through April 15. Find more here.
If you earn under $58,000:
CAMBA, 1117 Eastern Parkway (entrance on Utica Ave.) 718-282-5575
Hours: Monday-Thursday, 12 pm-7 pm; Saturday, 9 am-4 pm
St. John’s Bread & Life, 795 Lexington Ave. (Bushwick) 718-574-0058
Hours: Tuesday-Thursday, 1 pm-7 pm; Saturday, 9 am-4 pm
Lots more places provide free help to anyone who earns less than $18,000 a year, or people earning less than $50,000 with children. Here are a few:
Brooklyn Cooperative Federal Credit Union-Bedford Stuyvesant, 750 Myrtle Ave., 212-505-3487
Hours: Thursday, Friday, 1 pm-8 pm; Saturday, 11 am-7 pm
SEEDCO-St. Nicks Alliance, 790 Broadway (Corner of Fayette), 718-302-2057 x203
Hours: Monday-Thursday, 9 am-1 pm; Friday, 9 am-12 pm; Saturday, 10 am for first 10 clients
Much thanks to attorneys Joan Adams and Jeffry Haber and Emily Nelson of the Fifth Avenue Committee (and a Brokelyn contributor) for providing advice and resources! Adams said people can e-mail her with questions or for official tax help at [email protected].
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I volunteer on the intake for taxes at St. John’s Bread and Life. This coming week, we will also be open for taxes on Monday
The “never file an EZ” is interesting… but not that useful for poor folk. I don’t file the EZ cuz I had tuition and student loan deductions… This wasn’t itemizing. Just needed a different, more complicated form.
If you just have a straight job and nothing else (and rent), it’s VERY hard to itemize… and have the receipts for… enough to exceed the standard deduction. Itemizing is great — if it applies. But non-freelancers, non-business owners, non-homeowners, non-huge out of pocket medical bills, etc… it’s not gonna get the job done.
One thing to add: your best option is to file an extension online. That way you’re guaranteed to get a response from the IRS and can re-file if your request was rejected. If, on the other hand, you choose to send the IRS your request through the mail, you will never hear anything. That means it may never get to the IRS or it could be rejected. That will mean you’re accumulating late filing penalties without even knowing it.
A final cheap tip: this year FileLater.com is offering FREE tax extensions. All you need to do is login to FileLater using your Facebook username and password. Then select 5 of your Facebook friends to tell about our service. Do those 2 simple things and your tax extension is FREE!
Has anyone heard of the tax preparation software called 1040? I was really surprised and pleased with them. They are extremely comprehensive. You can get to them from this website: https://fileonline.1040.com/1040/SignUp/
Check them out. I hope your experience will be as rewarding as mine was.
For whatever it’s worth.
Ted