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Once you have prepared your return, you can either print it out and send it in by mail, or you can send it online to IRS. Most state returns can also be submitted online although some have not put in place technology to receive electronic returns yet (Florida, New Hampshire, Tennessee). One other point to consider when deciding whether you should you use an internet service or a tax software system on your hard drive is storage of your return. Myself personally, I prefer more control and want to save my return stored on my hard drive and not by a third party online.
Comparisons Most of online sites allow you varying levels of use so that you can actually key in your return information to see how you like program. With turbotax.com and hrblock.com, you only have to pay when you print out your return or e-file it. 2nd Story Software lets you prepare and print out your federal return for free but can only let you file state returns in 24 states.
For analysis of best tax software available, here are links to two excellent articles prepared on subject. One by ZDNet says ZDNet Reviews pick is H&R Block's TaxCut Deluxe 2001, which snagged Editors' Choice award. The other article is by MSNMoney:
http://www.zdnet.com/anchordesk/stories/story/0,10738,2841716,00.html
http://moneycentral.msn.com/articles ax/basics/8806.asp
If you are interested in more comparison shopping, http://www.epinions.com also provides ratings of tax preparation systems by individuals.
CANADA In Canada, there are two electronic methods that individuals can use to send their personal income tax and benefit returns. With EFILE, you use services of any registered EFILE service provider. With NETFILE, you send your return directly to government over Internet. Last year, more than 1.4 million tax returns were received through NETFILE service.
EFILE is an automated system that lets registered electronic filing service providers send individual income tax return information electronically. Using software and a computer, individuals can prepare and save their return on a disc and take it and their documents to an EFILE service provider for transmission. Also, clients can take their documents to a tax preparation service provider who can prepare their electronic return and send it using EFILE.
Netfile http://www.netfile.gc.ca lets Canadians file their personal income tax and benefit return directly using Internet. Income tax returns must be prepared using software that has been certified for NETFILE use.
From ˇ§former About Guidesˇ¨, here is a listing of tax software available for Canadians http://www.formeraboutguides.com/investingcanada axsoftware.htm Ensure prior to using these products that you see a confirmation on their site that they have received official certification from Canada Customs and Revenue Agency (CCRA).
For a list of currently certified software, visit CCRA at http://www.ccra-adrc.gc.ca/eservices ax/business/efile/menu-e.html#efilesoftware They do note that additional providers will be added to this list as they are approved.
Two of major players in Canada are QuickTax www.quickenstore.ca and Taxwiz http://www.taxwiz.ca
And finally, here is a link to an excellent Globe and Mail article detailing cost comparisons between these two dominant tax software competitors in Canada. http://www.globeinvestor.com/servlet/WireFeedRedirect?cf=GlobeInvestor axzone axzone_config&date=20020117&archive=taxzone&slug=RCARI
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Jim Slobodzian, BComm (Hon) is an expert in international investment and online commerce. publishes the Enroute.ca E-MONEY GUIDE providing free weekly news, commentary and tips on moving money online. http://www.enroute.ca or email info@enroute.ca
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