Do these VITA places have actual tax pros or just volunteers? I'm nervous about having someone who doesn't really know what they're doing handle my taxes, even if it's free.

They're volunteers but they're all IRS-certified and have to pass tax law training. Many are accounting students, retired tax professionals, or people who work in finance who volunteer their time. Each return also gets quality reviewed by a second volunteer before it's submitted. They're especially good with straightforward tax situations like W2 income. I volunteered with them for two years and the training was really comprehensive. For complex situations involving businesses or complicated investments, you might want a paid professional, but for basic W2 filing, they're absolutely qualified.

TurboTax is notorious for advertising "free" but then charging for almost everything. I've used FreeTaxUSA for the past 4 years including for a late 2022 W2 filing and it's actually free for federal (like $15 for state). Way more honest than TurboTax.

TurboTax is the WORST for this! They've been sued multiple times for their deceptive "free" marketing. They have a truly free version that's hard to find on their site, and they'll try to upsell you at every step. For basic W2 filing, use FreeTaxUSA or Cash App Taxes instead - they're actually free unlike TurboTax.

What about if I know I need to file an extension? Does that need to be done by 11:59pm on the 15th too? And is there any downside to filing an extension?

Yes, the extension request (Form 4868) must also be filed by 11:59pm local time on April 15th. Electronic is best because you get immediate confirmation. The main downside to an extension is that it only extends the time to file your paperwork, not to pay what you owe. You still need to estimate what you might owe and pay that by April 15th to avoid penalties and interest. If you're getting a refund, there's no downside at all to filing an extension. And having an extension actually slightly reduces your audit risk according to some statistics, though that shouldn't be your main reason for filing one.

This saved me last year! My local post office has a self-service kiosk that's open until midnight, and the postmark from that counts as official. Double check your local post office hours if you're cutting it close.

Great tip about the self-service kiosk! Not all post offices have them though, so definitely check ahead of time. And remember that private delivery services like FedEx or UPS can also be used, but the IRS only accepts certain types of delivery services as "timely filed" - there's an official list on the IRS website. One more thing: if you're mailing a payment with your return or extension, use Form 1040-V for the payment. Makes processing faster and ensures your payment gets properly credited to your account.

I just double-checked my paystubs and I do see federal withholding, but it's definitely low compared to my salary - only about 8% is being withheld when it should probably be closer to 15% based on my tax bracket. I don't see any "exempt" status listed though. Is there any other terminology I should look for that might indicate a payroll system error?

An 8% withholding rate definitely sounds like a setup issue. Besides "exempt," look for terms like "NRA" (non-resident alien), "AEIC" (advanced earned income credit), or any checkboxes marked for "multiple jobs" or "spouse works" on your W4 information that your employer has on file. Sometimes the issue is simply that an old W4 from years ago is still in the system with outdated allowances. Since the W4 form changed completely in 2020, any form from before that might be causing problems with current calculations. Ask HR if they can show you what W4 information they currently have in the system for you - it might be something from years ago that needs updating.

If you're going to owe, I'd recommend FreeTaxUSA over TurboTax. TurboTax charges extra for everything, especially when you owe and need to set up a payment plan. FreeTaxUSA is literally free for federal (state is $15) and handles payment plans without extra charges. Same accuracy, way less cost when you're already facing a big tax bill.

Thank you for this suggestion! I had no idea states might have their own free filing options. I'm in California - does anyone know if they offer something similar?

Yes, California absolutely has a free filing option! It's called CalFile and it's available directly through the California Franchise Tax Board website. It's completely free for eligible California taxpayers and handles most common tax situations. Just go to ftb.ca.gov and search for CalFile. Many other states have similar programs - Illinois has MyTax Illinois, New York has their own free filing options too. It's definitely worth checking your state's tax department website before paying for state filing through a third-party service.

This is super important advice. I switched from TurboTax last year and forgot to download my previous returns first. Made things way more complicated when I needed to reference something. Get those PDFs saved somewhere safe before you cancel!

Thanks for this breakdown! But what about the tax deductions for health insurance premiums and retirement contributions? I've heard those can make a big difference for self-employed folks.

Good point! Self-employed health insurance premiums are generally deductible "above the line" which means they reduce your adjusted gross income. Same with retirement contributions to SEP IRAs, Solo 401(k)s, etc. So if your friend pays $6,000 annually for health insurance and puts $10,000 into a SEP IRA, that could reduce their taxable income by $16,000, which would save roughly $4,000-5,000 in income taxes depending on their bracket. That would increase their take-home by the same amount.

I've been using QuickBooks Self-Employed for about 2 years now. It automatically tracks mileage, lets you categorize expenses, and calculates your quarterly tax payments. It's not perfect (sometimes categorizes things wrong), but it's been pretty close on the tax estimates.