How Do You File Taxes. Top 3 Ways Explained

Filing taxes to the IRS is a responsibility that all working individuals in the U.S. must fulfill. Several methods exist to complete your tax returns, each offering unique benefits. Whether you prefer the simplicity of online filing, the professional touch of hiring a tax expert, or the control provided by software, there’s a solution that fits your needs.

Office room with tax forms and a computer with a word tax on a display

1. Filing Taxes Online

Benefits of Online Tax Filing

  • Convenience: Online filing allows you to complete your tax return at your own pace and from the comfort of your own home.
  • Speed: E-filing offers the quickest way to submit your taxes and, if you’re due a refund, you will receive it significantly faster compared to traditional mail filing.
  • Accuracy: Online tax programs provide built-in tools to help minimize errors and maximize deductions, ensuring your taxes are done correctly.
  • Security: Authorized e-file providers use advanced encryption technology to secure your personal information and guard against identity theft.

How to File Taxes Online with the IRS

Step 1: Gather your tax documents, such as W-2s, 1099s and other income statements. Ensure you have your personal identification and proof of account (like Social Security Number or ITIN and bank details) available. It's vital for both identification purposes and to set up potential direct deposit for any refunds. Double-check that all documents reflect your current details to avoid any discrepancies.

Step 2: Choose an IRS-Authorized E-File Provider Visit the IRS free file website to find an authorized e-file provider. The IRS offers free filing options for taxpayers with income below $79,000. If your income is higher, you can still file electronically using the services offered by various IRS-approved providers such as TurboTax, H&R Block, and TaxAct.

IRS free file browsing page

Step 3: You’ll need to set up an account with your chosen tax prep software or provider. This typically involves verifying your identity and providing some preliminary information about your tax situation.

Creating free filing account

Step 4: Follow tax forms filing guides specificly for your needs to enter the information from your tax documents. The software will help you identify potential deductions and credits you can claim and provide guidance as needed.

Filing Personal Taxes:
You can find hassle-free filing options for your personal taxes! If you need guidance, there are Free File options available designed to help you navigate through the process step-by-step.

Businesses and Self-Employed Folks:
First things first, grab your employer ID number (EIN) if you haven't already. Next, you'll need Form 941 to report income taxes, social security tax, or Medicare tax withheld from employee's paychecks. Get ready to dive into filing your taxes, and remember to make those estimated payments to avoid surprises. There's also a handy online tool to access your business tax account with ease.

Charities and Nonprofits:
To ensure your organization stays in good standing, you'll need Form 990. It's also crucial to apply for and maintain your organization’s tax-exempt status.

International Taxpayers:
Are you an international resident or do you run a business overseas? Don’t worry, there are specific tax filing requirements tailored for international scenarios, making it easier for you to comply with local regulations.

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Step 5: Ensure that all the information entered is accurate. Double-check your return for possible errors and verify that your personal information, including your Social Security number and bank account information, is correct. Once reviewed, you can submit your tax return electronically.

Step 6: After submitting, you will receive an e-confirmation from the IRS within 24 hours to verify that your return has been accepted. If there is an issue, the notice will detail the problem so that you can address it promptly.

Specific requirements for online filing

  • Security: While e-filing is generally safe, make sure to use a secure internet connection (not public Wi-Fi) to protect your personal data.
  • Browser Compatibility: Ensure that the browser you are using is up to date, as older browsers may not support the security protocols used by tax filing sites.
  • Know the Deadlines: Be aware of the tax filing deadline, typically April 15th, to avoid penalties for late filing.
  • Direct Deposit: To receive your refund fastest, opt for direct deposit. Ensure that your bank account information is entered accurately to avoid delays.

Filing your taxes doesn't have to be an ordeal. By choosing to file online, you can take advantage of the ease, speed, and accuracy that electronic filing offers. You can also check directly if there are special requirements or specifics for the required form in your state, like special filling conditions for 1099 in California and Oregon. Whether through the IRS platform or an authorized provider, ensure you follow each step carefully for a successful tax return submission.

Pros

Faster processing and refund receipt.

Built-in error-checking features enhance accuracy.

Convenient and accessible from anywhere with internet.

Immediate submission confirmation from the IRS.

Environmentally friendly with reduced paper use.

Cons

Potential privacy and security risks online.

Costs associated with software or service fees.

Requires computer and internet access.

2. Filing Taxes by Mail

Mail post with a U.S. flag and envalope an calculator

While online tax filing is becoming increasingly popular, many still opt for the traditional method of filing taxes by mail. This section will guide you through the process of sending your tax return to the IRS via postal mail, including a checklist of necessary documents and valuable tips to ensure your return is delivered safely and on time.

How to File Taxes by Mail

Step 1: Start by accurately completing your tax return forms. You can download the necessary forms from the IRS website or pick them up at a local post office or use form filling services like PDFLiner. Be sure to select the forms that correspond to your specific tax situation.

Step 2: Once your tax forms are filled out, double-check your work for any errors. Attach all required documentation to your tax return. Use a paperclip or staple to ensure they stay together.

Step 3: If you owe taxes, include your payment by check or money order payable to the "United States Treasury." Be sure to write your Social Security number, phone number, and the tax year on the payment method.

Step 4: Address the envelope to the appropriate IRS service center (which varies depending on your state). Use a secure envelope and consider using trackable mail services to ensure delivery. Make sure you have adequate postage - a tax return often exceeds the weight for a single stamp:

Here are some of the most popular addresses, you can find an address for your state at the offficial IRS website:

Internal Revenue ServiceP.O. Box 1214Charlotte, NC 28201-1214

Department of the TreasuryInternal Revenue ServiceAustin, TX 73301-0002

Department of the Treasury Internal Revenue Service Ogden, UT 84201-0002

Internal Revenue Service P O Box 802501 Cincinnati, OH45280-2501

Step 5: Mail your tax return by the IRS deadline April 15 to avoid potential penalties for late filing. Keep in mind that the postmark date is considered the filing date.

Checklist of documents needed for mailing your tax return

Tax prep checklist
  • Completed tax return forms(1040, 1040-SR, 1040-ES, or others), and schedule C
  • W-2 forms from your employer(s)
  • 1099-NEC, or 1099-MISC, or other 1099 forms, if you are self-employed or have other sources of income
  • Copy of last year's tax return
  • Bank statements, if applicable
  • Receipts for deductions
  • Check or money order for any tax due

Tips for ensuring your mailed tax return reaches the IRS safely and on time

  • Use Correct Postage: Weigh your envelope at the post office to ensure you apply enough postage to avoid returns or delays.
  • Return Receipt Request: Consider using certified mail with a return receipt request to confirm the IRS has received your tax return.
  • Avoid Common Errors: Double-check your math, Social Security number, address, and make sure to sign your tax return. Errors can delay processing.
  • Keep Copies: Always keep a copy of the entire tax return package for your records before mailing it.
  • Mail Early: If you wait until the last minute, you risk post office delays. Aim to mail your tax return several weeks before the deadline.

Pros

Direct handling of physical documents may aid organization.

No digital access or technological skills required.

Avoids potential online security risks.

Cons

Longer processing times by the IRS.

Possible delays, damage, or loss of mailed documents.

Higher risk of human error without digital error-checking.

3. Hiring a Tax Professional

Advantages of a tax pro

Tax professionals provide expertise, especially for complex tax situations like investments, real estate, or business ownership.

Choosing a tax professional

Step 1: Look for credentials such as CPA (Certified Public Accountant) or EA (Enrolled Agent).

Step 2: Check reviews and ask for referrals.

Step 3: Ensure they have experience with tax situations similar to yours.

Cost сonsiderations

While costs vary, investing in a professional can result in better deductions and avoid costly mistakes.

Pros

Expert guidance on complex tax matters.

Reduces personal stress and workload during tax season.

Professional support in case of errors or audits.

Cons

Can be expensive, especially for simple tax situations.

Raises concerns about confidentiality of personal data.

Reliance on professional availability can be limiting.