If you are a freelancer or an independent business owner, you should choose online tax software designed for the self-employed. Online tax software for the self-employed can ensure that you take advantage of various tax benefits that can reduce your tax liability. Plus, because the software is continuously updated, you’ll have the latest tax law changes at your fingertips.
Choosing a self-employed version of online tax software can also provide additional guidance, which is especially important if you’re filing your tax return for the first time. But you should be careful before you decide to prepare your own self-employment tax return. If your tax return ends up being a little more complicated than you expected, it may be a good idea to hire a tax professional, such as a certified public accountant (CPA), to prepare your taxes.
The importance of using tax software
With constantly changing tax laws, it is increasingly difficult to manually prepare a tax return. Unless your tax return includes a simple W-2 form with only a few deductions, it’s important to use tax software. When choosing a tax software package, you’ll want one that’s easy to use and affordable, allows you to file all the state tax returns you need to file, and offers great customer support.
If you are looking for a free way to file, you can take advantage of the IRS Free File program. The program allows taxpayers to file federal tax returns for free by answering guided interview-style questions; in some cases, the state tax return is also free. To qualify, your adjusted gross income must be $79,000 or less.
But even if you don’t qualify for the IRS Free File program, you can choose to file for free using the IRS Free File Fillable forms. They differ from the Free File program. You are required to do more work by filling out the tax forms yourself without instructions, and there is no option to prepare and file state taxes.