Divorced and Doing Your Taxes?

    For many people, one of the most difficult, dreaded and confusing aspects of being an American is the need to file annual state and federal tax returns. The tax laws are constantly changing, and for some people, the complexities of preparing their own tax returns are simply too much to handle. While you can’t ignore this responsibility without serious legal and financial repercussions, there are resources available to help you, especially if you’re newly divorced and must handle this responsibility yourself.            

Without a doubt, the easiest, but most costly way to get your tax returns completed quickly and accurately is to hire an accountant (or Certified Public Accountant) to handle much of the process for you. Depending on the complexities of your financial situation, this can cost anywhere from a few hundred to thousands of dollars. 

USING SPECIALIZED TAX RETURN SOFTWARE              

A less costly option is to hire a tax preparation service, such as H&R Block or Jackson Hewitt. If you’re comfortable using a computer and possess even the most basic understanding of how to prepare your own income tax returns, you can save money using specialized tax preparation software, such as Intuit’s TurboTax (http://turbotax.intuit.com/) or H&R Block’s TaxCut (www.taxcut.com).  According to the IRS, in 2006, 73 million tax returns were “e-filed,” which included 20 million returns filed from home computers.   

 If you opt to use one of these software packages to prepare your state and federal tax returns, it’s absolutely essential that you purchase the most current version of the software, either from a local office supply or software store, or by purchasing and downloading it from the software publisher’s website. Because several different versions of TurboTax and TaxCut are available, you’ll also want to purchase the version that offers the functionality you need, based on your personal situation.        

TurboTax, published by Intuit (the developer of the bestselling Quicken personal financial management software), personalizes tax preparation based on a customer’s unique needs. “TurboTax 2007 is the result of a singular focus on ease. We’ve created a dramatically simplified tax preparation experience to delight customers,” explained Kiran Patel, general manager of TurboTax at Intuit. “By making TurboTax the easiest tax software to use, we help customers get the best possible outcome on their taxes.”          

Depending on which version you purchase, TurboTax 2007 is priced between $19.95 and $74.95. Once the software is loaded onto your Windows or Mac-based computer, you’ll be asked a series of easy-to-understand questions that will help the software pinpoint the most appropriate deductions and forms to file. The software will also take into account major life changes, such as your divorce.