How to Get a Bigger Refund With Tax Software

It's a question everyone asks at tax time: How can I get more money back? If you file your own return with a tax service app here's what you can do to minimize your tax obligation.

If you haven't filed your 2017 tax return yet, however, there's still time to minimize what you owe (or maximize what you get back) by using a personal tax prep website. There are several good-to-excellent services to choose from, and you can find the one that's right from our collection of the best tax preparation software. Some are definitely better than others, but the tips below apply to many of these services.

Less Taxing Taxes

Even if you only write an occasional letter or work memo, your composition skills probably improved when you first started using a word processor. Suddenly, going back and making a correction was no sweat. The same concept applies when it comes to income tax preparation websites. There's no comparison between completing your return manually (using paper IRS and state forms and schedules) and doing so with the help of a dedicated tax prep site like TaxAct, for example.

Minimize Tax Obligation

Why would you want to sit at a table surrounded by a mound of papers that you have to fill in manually when you can do the same task sitting at your computer—or even your smartphone? Yes, that's right: You can do your taxes on a phone or tablet, so we've rounded up the best mobile tax preparation apps. Also, since using one of these services on your desktop or your phone can help minimize your obligation, there's really no reason to do your taxes by hand.

Tax site developers know how much most individuals loathe tax preparation, so they've made them exceedingly approachable. Plus, you're more likely to do a thorough job when you're interacting with a friendly, visually appealing, easy-to-use application. Instead of giving up in frustration when you can't figure out how to claim a particular credit or deduction, you just need to follow the instructions of your service of choice. Editors' Choice TurboTax does an especially good job here, offering an exceptional user experience and strong support.

Easing the Way

How do tax sites streamline such a convoluted, complex process to the point where you're more likely to file a return that reflects every element of your tax-related finances? Below are just some of the many ways.

MInimize Tax Obligation

  • Step-by-step walk-throughs: You don't have to deal with official IRS and state forms and schedules. TaxSlayer, for example, guides you through the process via a helpful wizard. It asks questions and you provide answers by filling in fields or selecting from options. It performs all the calculations and completes the required documents for your returns. Because it touches on nearly every major (and most minor) tax topics, it's harder for you to miss something that could save you money.
  • Organization: Every tax preparation website starts off each section (income, deductions, credits, and so on) with a list of all the ways you could possibly receive money (including W-2s and self-employment income) and the ways you might have spent it (such as mortgage interest and medical expenses). You don't have to worry about finding the right forms (or inadvertently forgetting one). All you need to do is answer questions about how you earned and spent your money.
  • "Where Do I Enter?" tools: Whether you use a step-by-step wizard or choose from lists of tax topics, you may have unused forms at the end. If you're doing your taxes manually on April 14, it may be tempting to put it back in your tax folder and hope the IRS doesn't notice. The IRS will eventually notice, and you may have to pay a penalty, which adds to the cost of your taxes. The best tax websites help you track down the exact screen where you can enter your leftover data.

Do It Right, Avoid Fines

Personal tax preparation websites help you put the right numbers and information in the right places. But what if you don't understand a topic or are not sure if it applies to your situation? For example, you might want to know if you are eligible for a certain deduction, without risking a penalty, if you're not.

Minimize Tax Obligation

There are so many additional ways to file an incorrect income tax return. Forgetting to report income is one of the most serious errors, but you can also make other mistakes that may result in a higher tax bill, or even a fine. Tax sites help you avoid both by providing guidance that's written simply and clearly—not in the IRS' sometimes-complex language. They might:

  • Explain a question in more depth.
  • Hyperlink a word or phrase and open a window containing a definition.
  • Display FAQs and other context-sensitive information.
  • Contain voluminous files that you can search for answers to specific questions.
  • Offer chat, phone, and/or email help.

The better you understand what the information your return requires, the more likely you are to knock some money off of your tax bill and stay off the IRS' radar.

Hundreds of Deductions and Credits Available

All of these helpful tools make it more likely you claim every deduction and credit you're legally allowed, especially compared to if you were doing your taxes by hand.

Minimize Tax Obligation

That's really the point of these tax-preparation services. Yes, they help you document your income carefully—many, for example, let you import your W-2 data from previous years. But when they break down the Form 1040 for you, they strive to be as comprehensive as possible, especially when it comes to the deductions that can lower your tax bill. TurboTax, in fact, claims to support more than 350 deductions.

More Savings

There are other ways that personal tax preparation websites help minimize your tax obligation. For example, they:

  • Include questions about taxes you may have already paid (such as estimated taxes and taxes withheld on retirement income).
  • Pay special attention to health insurance. The individual mandate was still in effect in 2017, so if you did have health coverage, you certainly want to provide that information. Otherwise you risk paying a penalty.
  • Provide multiple versions of their applications at different prices so you don't add any more to your tax costs than necessary.
  • Offer totally free versions for both federal and state filing if your return is simple (in some cases). H&R Block More Zero, though, is the only site to support the Schedule A in addition to the 1040EZ, so you can itemize deductions at no cost. Credit Karma Tax actually supports all major IRS forms and schedules at no cost to you for either federal or state filing.
  • Make tax professionals available to complete your return if it simply becomes too complicated for you to finish on your own. It will cost you some extra money, of course, but may reduce your tax bill in the long run. Jackson Hewitt, H&R Block, Liberty Tax, and TurboTax all offer this.

Spend to Save

Unless your return is very simple or you're well versed in the tax code, you'll probably have to spring for one of the paid versions of these sites. This will add to your total tax costs for 2017, but not a significant amount. Since these personal tax preparation services save you time and frustration, ensure accuracy, and can find deductions and credits that will lower your tax bill anyway, they are likely worth the cost.