Why do the IRS’ informational’s feel like a throwback to those old, low-quality and low-res ‘90s workplace harassment seminars? Because even when you’re e-filing your taxes, you’re essentially being forced into a time-squelching rift between conscious thought and the empty void that’s indicative of a corporate board room. You plug incoherent numbers into a machine and hope to God it produces a positive return in the end.
Yes, you have to do something about your taxes. Yes, you might end up going through a website that’s trying to upsell you hard from their ‘free filing’ options. Yes, it will take you a good chunk of your free time.
But there are ways to be smart about it, and getting an extension is honestly a good option, especially considering the IRS has been lagging behind on processing last year’s returns. That’s why we’re here to give you some advice on how and where to file and what’s the best way to get an extension if you need one.
Despite sites like TurboTax and H&R Block’s near stranglehold on the tax filing market, there are other means of e-filing, although some official options suggested by the IRS are more convoluted than others. The IRS requires that these sites offer a free e-filing option, but there are no real regulation on how much these companies try to upsell you when filing. Gotta love paying for the privilege of giving the government information it already knows about you.
So if you can, it’s probably best to find a free service. The IRS does not offer an in-house option to file based on a deal it struck with tax filing companies two decades ago. These sites also have restrictions based on your adjusted yearly income, though most allow for filing if you make $73,000 a year or less. There may also be restrictions based on which state you live in. Some, like TaxAct’s free version, do not allow for free filing of state taxes.
You can also plug in all the numbers yourself using the IRS form-fillable documents, but that will require you to create an account on the IRS site, which itself can be quite a time consuming hassle as it will require you to have an ID like a driver’s license or passport at the ready, and also scan your face to ID.ME. This is also the most lengthy option, and since it’s already Tax Day, you’re best either filing for an extension or using the other tax filing options.
TurboTax is often noted as the most easy-to-use e-file option. They have a lot of tooltips to help you find out which form to file and where to find the information the system needs. You can also simply upload your W-2 and it will fill out all the necessary boxes automatically. It also helps if you use them year after year, as some of your profile information gets saved. The catch is they also are incredibly predatory in how they try to upsell you, and despite their advertising the free offering, they are also one of the most expensive options if you get suckered into giving them money to file.
Other free options include:
Most of the free file options listed above also allow you to submit for the extension. You can log onto one of these sites and answer the questions to submit for the extension.
This is effectively an option for you to note your tax liability and then pay what you owe. The IRS will charge a 3% interest on the unpaid balance until the full amount gets submitted, and there will likely be further fees for every month they go unpaid.
This extension gives you until October 15 to file your taxes. You will need to note what you already paid on the extension when you file your taxes later this year.
If you don’t want to use those e-file platforms, you’ll need to submit a form to the IRS. Since it’s already Tax Day, your best option would be filing the form online through the e-file providers.
There is no penalty for filing the form last minute, but there can certainly be repercussions if you fail to file anything at all. You should receive notification that the extension application has been filed. There are ways to track the status of your application as well.
There were multiple changes from last year to this year’s filings that may affect your return, though if you’re like most people, it’s not as much as you think. For one, if you were unemployed last year and were on unemployment, you will still likely have to pay taxes on that unemployment income, compared to 2020 when there was at least some protection from taxes on unemployment.
Most people will be filing for a standard deduction, which was adjusted for inflation by $150 up to $12,550 individually or $25,100 for those filing jointly.
If you were one of those lucky few who managed to get your student loans forgiven in 2021, then you won’t owe taxes on those loans going forward thanks to the American Rescue Plan. This new law lasts until 2025, so better start thinking about how you can get or at least advocate for forgiveness, if at all possible, to save the most on that damned degree.
Tax brackets were changed, and some people may find that if they were in one bracket, they were bumped down to a lower bracket. For most people, this won’t change a single thing about how you file, but it remains something to note.
The amount you can get back on your return from charitable donations was also expanded thanks to the CARES Act. You can get $300 back per charitable donation to a qualifying organization, and if you’re filing jointly, you may even get $300 back from each individual. This likely won’t work if you’re doing a standard deduction, which is automatically selected with most free-filing systems.
Just a reminder, the main reason that you’re stressing about taxes is because companies like Intuit, which owns TurboTax, and H&R Block have lobbied heavily to quash any mention of a return-free program, or even for the IRS to invest in its own free-file system.
So part of the reason we have this headache every year is because these large fintech companies are making too much money off the laborious nature of filling our taxes. Don’t want to be a downer, especially as you’ll likely be spending your lunch or evening today filling in last-minute forms. Instead think about green pastures, the horizon is just a thin pencil line separating earth and an ocean of blue sky. There’s no 1098 request box in sight. There’s only the soft, thrumming melodies of a violin plucking away on a nearby hill.
Then after you are calm and relaxed, an alarm sounds in your ear. TurboTax is standing there with a bullhorn. It wants you to do your taxes, and it reminds you that if you spend just $50, they will help you itemize your deductions, and for just another $30 on top of that…and on and on and on…