The right tax treatment could save you hundreds or even thousands of dollars. The wrong tax treatment could mean jail time and fines in the hundreds of thousands of dollars.
Foster City, CA (PRWEB) March 16, 2011
GetRichSlowly.org released the results of a joint poll with MoneyRates.com which reveals how a set of respondents will be filing their taxes this year. A corresponding article, “Tax Prep Costs: How Much Will It Cost to Get Your Taxes Done?” examines the wide range of price points for various forms of individual tax preparation, based on a survey of tax prep services across the U.S. conducted by GetRichSlowly.org.
Of 2,200 respondents who were polled about their chosen tax preparation method for filing 2010 taxes:
- 62 percent plan to file the return themselves using software
- 23 percent intend to pay somebody else to prepare the tax return
- 10 percent will file their return themselves by hand
- 5 percent have a friend or family member who will provide free help
The tax prep survey data reveals that both tax preparation method and geographic location can affect the cost. However, the choice of tax prep method should not be made on price alone. Whether using free online tax filing services or more expensive in-person tax prep, individuals should keep in mind the hefty penalties for those who file improperly. Spending less on tax prep in order to keep more money in a savings account may be penny wise, pound foolish.
“Consumers need to make informed decisions when searching for a tax preparation service, because there is so much at stake. Not only are there significant differences in the costs of these services, but the quality of advice is hugely important. The right tax treatment could save you hundreds or even thousands of dollars. The wrong tax treatment could mean jail time and fines in the hundreds of thousands of dollars,” according to Richard Barrington, personal finance expert for MoneyRates.com.
The most and least expensive online tax preparation options for filing federal and state returns, according to GetRichSlowly.org, are:
- Most expensive: ExpressTaxRefund, approximately $70
- Least expensive: TaxHawk, $0
The most and least expensive tax preparation software options for filing federal and state returns, according to GetRichSlowly.org, are:
- Most expensive, Turbo Tax® (Intuit), approximately $90
- Least expensive, Tax Act (2nd Story Software), approximately $23
Online and software tax prep prices can vary according to the complexity of the tax situation, while professional tax preparer costs vary according to the complexity of the situation as well as the location of the filer. Filers in cities such as Reno, Nev. or Little Rock, Ark., are likely to pay zero to $80 to file their returns through a tax professional. At the other end of the spectrum, using a tax professional in New York, N.Y. or Los Angeles, Calif. can run anywhere from $100-$400 or more, not including the cost of the state return.
Visit GetRichSlowly.org for more information about online tax services, tax software, professional tax prep costs and audit red flags. The site is also running a video contest where people can submit videos illustrating their personal finance tips and success stories to compete for $1,500 in prizes.
GetRichSlowly.org is a personal finance blog providing readers with a forum for sharing and discussing practical everyday financial strategies. Founded in 2006, the site is based on the premise that few people get rich quickly, but almost anyone can get rich slowly by patiently following some simple rules. GetRichSlowly.org, was ranked among "The Top 100 Personal Finance Websites" by MSN’s Liz Weston and has been named "The Most Inspiring Money Blog" by CNN's Money Magazine. The website has been featured in The Wall Street Journal, Fox News, CNBC, Real Simple, and The New York Times.
MoneyRates.com has been a leading source of information on bank rates, personal finance, savings accounts and investing since 1999. The site provides the highest rates on certificates of deposits, money market accounts and high-yield savings accounts.