Most states require that taxpayers file state income taxes independently from their federal income taxes. You’ll need to report your income to your respective state via either paper or electronic filing method – though residents of Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming can skip these steps altogether. We’ve compiled a how-to guide to help you decide which method is best for you, and added in some additional information that will speed up your return.
Filing By Hand vs. Using an Online Service to File State Taxes
Before you begin your taxes, you’ll first need to decide whether you’d like to file your taxes by hand or you’d like to use tax preparation software. Though the majority of Americans use some form of tax prep software to manage their income, property, and investment taxes, filing by hand is less difficult than most people believe.
If you’d like to double-check your taxes or learn more about the tax process, filing by hand might be the right choice for you. However, if you have a complex tax situation (for example, you own rental properties or you need to calculate capital gains taxes from stock movements), you need your return sooner or you don’t have time to do in-depth research on deductions and credits on your own, you’re better off choosing from one of our favorite tax software providers. If you’ve lived in more than one state this year, you may also be required to file two state tax returns. To learn more about filing more than one return, check out this video by TurboTax
Method 1: Filing By Hand
Filing your own taxes does not require a CPA, an accounting degree or even a computer – most taxpayers with simple situations can file and mail in their taxes for free on their own. Some of the benefits of filing your taxes by hand include:
- You learn more about the tax process and where your money goes. Tax software is designed to save you time – not teach you about credits, deductions, or how your tax money is used. If you’d like to learn more about the process, there are few better ways than getting your hands dirty and filing your own taxes.
- Fight against overly complicated taxes. Did you know that the U.S. tax code is over 10 million words long? The tax code has become so long and arduous to read and understand that it’s likely you don’t have the time or patience to sort through the myriad rules and regulations of the tax code. Some critics of the tax code blame tax software manufacturers for this over-complicated mess because some companies lobby against tax reform. You’ll encourage and support simplified tax regulations if you do yours by hand.
- Save money. Filing your own taxes is free, less the cost of postage and your time.
If you file your state taxes by hand, you’ll need to download and print the applicable forms from your state’s government website – you can also usually find your state tax forms pre-printed at your local library when tax season approaches. Your state’s government website address is the abbreviation for the state plus .gov; for example, Pennsylvania’s state website is https://www.pa.gov/, while New York’s can be found at https://www.ny.gov/.
For most taxpayers in most states, you’ll only need your Social Security number, name, address, filing situation and income information to complete this form. Your state’s form will also indicate acceptable payment methods, instructions on your county’s local collection address, and more information on how to choose your return method. The following is an example of a state tax return used previously by the state of Pennsylvania:
Can’t find your form for the year? Don’t panic – it may not yet be available, as tax documents are frequently updated and changed for the coming tax year. Check back on your state’s website in mid-January of the year you must file taxes, as this is one of the most common times for states to finalize the year’s forms.
Method 2: File Your Taxes Using a Tax Preparation Software Program
If you ’re self-employed, own a small business, or pay a significant amount of money in brokerage taxes, you may want to use a tax prep software. Some of the benefits include:
- Save time. Say goodbye to poring over endless documentation to learn about what you must pay and where you can save. Tax software uses a simple interview-style format to guide you through the filing process as quickly as possible.
- Locate every possible deduction and credit. Tax software is programmed to locate and help you find every possible credit and deduction, which helps you save money and ensures that you don’t overpay by missing deductions.
- Enjoy faster processing. Due to the overwhelming amount of mail received every tax season by the IRS, paper taxes take significantly longer to input and process. Filing electronically means faster processing – and a quicker return.
If you choose to file electronically, you’ll need to choose a tax software provider. Be sure to carefully consider which service you’d like to use before you make a purchase, as most tax prep software providers offer a host of packages that vary in price based on functionality. Once you’ve made a decision, follow your software’s instructions and pay to submit your return at the end of the program. Your tax software will then tell you what you owe and handle the submission to your state government. Keep in mind that most tax software charges a small fee to file state returns, even if you did not pay to download the software.
Choose a Tax Software Program
Before you start comparing the dozens of software programs on the market, check out our list of the best free tax software programs. If you’re self-employed, you’ll likely need more software functionality to handle your itemized deductions and other credits; we’ve also created a list of the best tax software programs for self-employed men and women as well, so make sure to consider these packages before you make your final choice.
The best way to ensure that your taxes are filed fee-free on time, with every possible deduction and credit included is to get started as early as possible. If your state forms have not yet been released to the public, you can still learn more about the credits and deductibles that you qualify for, round up your receipts and business expenses for the year and make last-minute contributions to your traditional IRA or 401(k) to minimize taxable income – and maximize your return.
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