Hard to Pick Tax Software Winner

So you answer a few questions online, then you can either email, fax or drop off your documents at a local office. The pro will prepare your return, sign it and e-file it for you. The cost starts at $80, but the price may go up depending on the complexity of your return.

Another big note: If you have to file multiple states, www.hrblock.com will let you e-file them all. The competitors only allow one state e-file.

It's All About the Money

If it comes down to the dollars for you, TaxAct might be the way to go.

While most of the programs cost anywhere from $20 to $50 depending on how many state returns you need to prepare, you can get TaxAct's "Ultimate Bundle" for a mere $15.95. You have to use the online version of the program to get this price, but then you can prepare and e-file your federal and one state return. Not a bad deal.

Some DIY Tips

Before you sit down to prepare your return, pour yourself a cup of coffee and put on your fuzzy slippers. This process will take you a few hours, so gear yourself up.

Get all your documentation together so that you have everything in front of you when the program's interview starts asking you questions.

In most instances, you'll have to pay before you can e-file so have your credit card ready. Also, if you're getting a refund and want it directly deposited into your checking account, have that number and the usual related ones handy too.

Pay attention to hidden fees. That means do not request a "refund anticipation loan" so that you can receive your refund early! These loans charge ridiculous interest rates that can run on an annualized basis well into triple figures. If you e-file, you'll get your refund in two weeks anyway, so there is no need to pay ridiculous interest rates just to have it a few days earlier.

And don't have payments taken out of your refund. Just use your credit card to pay, otherwise you'll be hit with a processing fee. As an example, TurboTax charges $19.95 to have payments taken out of your refund.

Just because you clicked "send" and e-filed doesn't mean you're done. Be sure to check back in a day or two to make sure the IRS accepted your return. You'll then be assigned a unique 14-digit Declaration Control Number, or DCN, that serves as proof that your return has been accepted as electronically filed. So keep that number in your records.

Don't forget, if you owe money to Uncle Sam, you still have to pay him, even if you e-file. For your federal return, you can either use a credit card or have your bank account debited. Some states will let you do the same.

To pay your federal taxes by mail, send Form 1040V along with your check. To pay your state taxes by mail, send a check with the corresponding form for your state.

So just because I didn't officially review these products doesn't mean you can't. If you have a favorite tax-prep program, let me know.

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