TurboTax Federal Tax Estimator
Tax season offers an opportunity to reorganize and simplify the way we prepare all year long for the tedious task of tax preparation. Keeping up to date on financial obligations with the Internal Revenue Service (IRS) throughout the year is a good start to being better prepared.
Fortunately, TurboTax offers a tax estimator called TaxCaster that can make lite of the tax estimation process and get you on track with Uncle Sam.
Preparing you taxes should always start with a tax estimation to give you a fairly accurate estimate of what tax liability you may be facing.
Trials and tribulations of tax season start long before it's time to prepare your tax return. Truth be told, it's far more wise to start planning for your tax preparation task at the beginning of the year in order to make better tax wise decisions.
The TurboTax TaxCaster Tax Estimator is one of the best tax preparation tools I have in my arsenal. It's a super handy tax tool that helps me keep in tune with what's going on financially with my annual tax bill.
I have learned to use this calculator several times a year to help me understand what my financial obligations are as my income changes.
TaxCaster is also available in Smartphone applications as well as online. Furthermore, It's FREE to use, regardless of whether you purchase any TurboTax products or not.
Flat out, it's just a great tool for tax planning.
This simple to use product offer tax filers a way to keep track of their tax debt on the run when being used with the Smartphone app. The big advantage to this on-the-fly tax season tool, is the ability to enter tax data like charitable contributions right when you are making the donation or contribution to your charity of choice. This way you can see what advantage you are gaining in the calculation results.
How to use TurboTax TaxCaster Tax Estimator
Then you move into the "Income" section where you will be able to enter your income and federal and state taxes that were withheld. Here you can also enter unemployment income.
Then in "Other Income" section you can enter interest, dividends, capitol gains and losses, IRA distributions, social security benefits, alimony and other income sources.
Next is "Business Income" where you can enter earnings for self employed tax filers and small business owners. No doubt you will feel more pain here as the taxes add up much faster when your paying the full tax bill instead of splitting it with an employer that would normally pay their half.
These figures are obviously what you will be paying taxes on, but now you get to lower this taxable income by claiming deductions and tax credits that may apply to you and your tax filing situation.
There are also options here to enter other taxes paid and other deductions that may qualify you for more financial income tax breaks to lower you tax bill.
Lets face it, this is important! These tax breaks allow you to keep more of you hard earned cash, instead of donating it to the government which we all know will waste it away on special interest spending.
TurboTax Final Result
Once you have entered all the data above you can look at the final result page to see how all these numbers add up to what will be your federal tax bill, or credit.
Obviously we are all looking for a credit that will yield a nice refund in the mail box. However, if you owe more taxes, this tool will give you ideas on what additional deductions you may want to try and qualify for in the future.
Fact is, staying on top of your federal income tax responsibilities all year long will help you make better decisions to lower your year end tax bill.
I'm no rocket scientist so having a tool that can save me some serious cash that otherwise would go to Uncle Sam is a good thing for keeping my wallet padded.
Give it a try and I have full faith that you will find this tax calculator to be a nice addition to your tax season arsenal for lowering your year end tax bill.