It’s time to efile! My mailbox was packed with tax forms this weekend. And of course, while I’m still waiting on plenty of forms, many of you received everything you needed to e file your tax return.

As the first tax filing rush of the season begins, let’s check out all the free efile options for your federal return to get your taxes done and on their way to the IRS!

Free EFile Tax Return Options

1. TurboTax. TurboTax offers a free online edition available at TurboTax Online. The turbo tax efile includes free e-filing for forms 1040, 1040A or 1040EZ. TurboTax is one of the most popular tax software packages around and it integrates with Quicken.
2. H&R Block. H&R Block is offering a free edition if you want to prepare your return online. It also includes free e-filing. I used the H&R Block tax software for many years when it was called TaxCut. The federal efile is available for forms 1040, 1040A, or 1040EZ. It’s available at H&R Block Free Efile.
3. TaxAct. You can prepare, print, and e-file your return for free. TaxAct offers an online version or a download version of their software at TaxAct. I used the download version of their software a few years ago, and I was pleased. The selling point for the free Tax Act is the inclusion of Schedule C, for the self employed, in their free tax efile.
4. IRS Free File. The IRS Free File program is an IRS partnership with various tax software companies offering free filing. There is an income limit of $57,000 or less AGI for the irs.gov efile.
5. IRS Free File Fillable Forms. The IRS Free File Fillable Forms is not a free tax software, but blank forms. However, there are no income limitations. You pick the forms you need, fill in the numbers, and e-file for free. If you know what you are doing, the IRS efile is a great option!
6. 1040.com. If you don’t have dependents, you can efile your tax return for free at 1040.com with a taxable income of less than $100,000. It’s a good option for young adults who aren’t itemizing yet.

Free Tax Preparation

All of the options to efile taxes free are great. However, if you are like many people, including most of my friends and family, you really just want someone else to prepare and efile taxes for you. The great news is that there are various options for free tax preparation. In addition, these programs usually offer free state efile too.

• VITA. The Volunteer Income Tax Assistance program offers free e-filing. You go to your nearest VITA location in person and have a volunteer complete your return. I’ve volunteered in the past; it’s a terrific program. There are also may VITA locations that offer free efiling for military personal. The VITA program targets low to moderate income, but our location did not have any income cutoffs, so it’s worth checking out.
• Tax Counseling for the Elderly. The TCE program provides free tax preparation for those 60 and older. You can call 1-800-829-1040 to find a location near you.

Now that you know all of your options, it’s time to efile!

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When is the 2012 tax deadline for your 2011 tax return? It’s not when you might think it is this year! Instead of the traditional April 15 deadline, the 2012 tax deadline for your 2011 tax return is April 17, 2012.

Tax Deadline Extended

The deadline to file taxes this year is due to the Emancipation Day holiday. The 2012 tax deadline is extended for everyone even though all states do not observe the holiday. Tax day 2012 is also extended since the traditional April 15 deadline falls on a Sunday this year.

Tax Deadline Postmark

Whether or not you meet the tax deadline is based on the postmark on your taxes. You must have your taxes postmarked by the deadline, but the IRS doesn’t need to receive your taxes by the 2012 tax deadline. If you are using TurboTax, and plan to mail your taxes, deliver it to the post office before closing time on April 17, 2012.

Make sure you check the address if you mail your return on tax day 2012. The IRS changed the mailing address for many taxpayers last year.

If you efile, you’ll also need to submit your return electronically by April 17.

Tax Extensions

If you file for an extension, your tax return will be due six months after the April tax deadline. The tax deadline for extended returns this year is October 15, 2012. You can file Form 4868 to get an automatic extension. However, you still have to pay the tax due by the original tax deadline on April 17.

Tax Deadline Extras

While you are working on your tax return, there are some other deadlines that fall on the same day as the tax deadline.

Retirement Contributions. The tax deadline is also the deadline for making contributions to your IRA and Roth IRA.

Estimated Tax Payments. If you make estimated tax payments, the April tax deadline is also the same day that that estimated tax payments are due for first quarter.

Government Shutdown. You must still file by the tax deadline even if there is a government shutdown impacting tax refunds like we saw last year.

More Tax Filing Information

Tax Refund Dates. Once you file your tax return, see the tax refund cycle chart to find out when to expect your refund.

Filing Delays. If there is an IRS filing delay for any reason, it does not extend the tax deadline. However, the IRS will delay the processing of your tax return.

Tax Filing Online

Now that you know when the 2012 tax deadline is you can go ahead and file your taxes online right now for free with TurboTax!

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The big news about the Obama tax compromise revolves around the Payroll Tax Cut and the extension of the 2001 Bush Tax Cuts.

But the tax deal that was passed at the very end of the last Congress included an “AMT patch” to fix to the alternative minimum tax, or AMT.

What is the AMT?

The AMT was created in 1969 to ensure that the very wealthy paid an appropriate share of taxes. With so many strategies available for lowering your tax bill, the very rich (and smart) were finding ways to reduce their taxes to almost nothing.

Congress enacted the AMT so that these people had to pay a certain amount, regardless of the deductions and exemptions that would otherwise be available to them. The AMT tax gets rid of the standard tax brackets and instead applies a 26% tax rate to the first $175,000 and 28% after that.

The problem with the AMT is that it was not created with an inflation adjustment. So over time, the AMT stopped applying to just the very wealthy and started affecting middle class taxpayers. Each year, Congress has to pass an “AMT patch,” thus reducing the number of people who fall into AMT territory.

How the AMT Works

Technically every taxpayer must calculate their taxes under both the “normal” rules and the AMT rules. The AMT rules allow for fewer deductions – in fact, AMT payers cannot claim the standard deduction, personal exemptions or other taxes paid.

If you use tax software or employ a tax preparer, your taxes are calculated both ways even if you don’t know it, and you owe the higher of the two. But if you pay the AMT in some years and don’t pay it in others, you may be able to take a credit to get some of the AMT back.

AMT and the Tax Deal

As stated earlier, you owe the higher of “normal” income taxes or the AMT tax. But Congress has intervened to pass a special exemption in each of the last several years, referred to as the AMT patch.

According to CNN Money, this AMT patch will help 20 million taxpayers avoid paying the AMT.

AMT Exemption

Under the exemption, you do not owe AMT on the first $X of income, even if you otherwise would owe it. As part of the tax deal, the AMT exemption amounts are:

As you can see, the AMT patch was temporary and does not apply to 2012. We will have to wait to see if another law is passed to change the 2012 AMT exemption. If not, the exemptions above will apply.

Of course some taxpayers will still have to pay the AMT. You can use the IRS AMT Assistant to see how the new exemption rules might affect you.

Be sure to stay tuned, we’ll cover ways to minimize your AMT liability – even if you’re too late for 2010, 2011 tax planning should already be under way!

More on the Obama Tax Cuts

Stay tuned as we cover more in our series on the Obama tax cuts.

• 2011 Payroll Tax Cut
• Obama Tax Deal In the Works
• 2011 Tax Calculator

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How much money do you have to make to file taxes? What is the minimum income to file taxes? Every year, those are familiar questions that I get. Let’s take a look at the requirements for the minimum income to file taxes in 2010.

2010 Minimum Income Requirements

For the 2010 tax year, you need to file taxes if your gross income meets the minimum income for your filing status and age:

This table does not apply to dependents. See When Do Kids Need to File Taxes? for minimum income to file taxes for children.

Social Security Income

Gross income doesn’t include social security benefits.

However, there is an exception to this rule if half of your social security benefits plus your other gross income is more than $25,000 ($32,000 if married filing jointly). Once that happens, you’ll need to file a 2010 tax return. Married filing separate also have different social security rules.

Other Income Sources

There are special rules for self employment earnings and church earnings. You must file taxes if your:

• Self employment net earnings are greater than $400.
• Church earnings are greater than $108.28 and are exempt from employer Social Security and Medicare.

If you earn enough money to file a tax return, you must file your tax return by the tax deadline.

Other Tax Filing Requirements

In addition to the income requirements, there are other circumstances when you must file a tax return. One example is if you sold your home. For all the requirements, see Publication 17.

For last years requirements you can see the minimum income to file taxes in 2009.

Optional Filing

Even if you are not required to file a tax return, you can choose to file one. You may want to file an optional tax return if you had any federal withholding or are entitled to tax credits, like the earned income tax credit, and want to get a refund.

Once you file, you can see How Long Does it Take to Get Your Tax Refund Back?

2010 Tax Calculator

If you are under the minimum income to file taxes, and are unsure whether or not filing your taxes will benefit you, use our 2010 Tax Calculator to compute your tax liability and refund.

Tax Filing Online

Now that you know how much money you have to make to file taxes, you can go ahead and file your taxes online right now for free with TurboTax!

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Since the number of Roth IRA conversions per year is unlimited, and we have the ability to unconvert the Roth IRA conversions, there’s a fantastic strategy to Roth IRA conversions to minimize your taxes!

We previously explored roth conversion strategies like increasing your basis to avoid taxes, but if you’re ready to convert the taxable portion of your traditional IRA, this one might be for you!

Roth IRA Conversion Strategy

Here’s the plan to execute the Roth IRA conversion strategy:

Create multiple traditional IRAs. For example, if you have a $100,000 traditional IRA to convert, separate it into 4 $25,000 traditional IRAs.

Convert each IRA. For each account, make a traditional IRA conversion to a Roth IRA. You’ll want to keep each new Roth IRA separate.

Invest differently. In your new Roth IRAs, you’ll want to take a separate investment approach. Separating by each asset class would probably make the most sense and gives the most flexibility.

Monitor Returns. Since each Roth IRA holds a different asset class, the returns will vary. If the value goes up, leave it alone.

Recharacterize. Select the accounts where the value went down, which could be all, some, or none, of the new Roth IRAs. Reverse the conversions with a recharacterization by October 15, 2011 (with an extension), for 2010 Roth IRA conversions.

Tax Savings. With this strategy you’ll avoid paying taxes on money you lost, without having to recharacterize the entire conversion, allowing you to keep the conversions on the winners!

Tips and Tricks

Reconvert. You can later reconvert the money that you recharacterized, but there is a waiting period of at least 30 days and at least until the next year. You’ll be able to reconvert at a lower value, which means lower taxes.

Rebalance and Consolidate. After you’re done converting, you can put the Roth IRAs back together for a more simplified record keeping.

Keep Good Records. The paperwork on this one could get very complicated if you take it to the extreme. Be sure to keep good records so you don’t make tax time next year a real headache!

Communicate Clearly. If you have multiple accounts, you’ll need to work closely with your broker to make sure the correct conversions and recharacterizations take place. I’ve done Roth IRA conversions and recharacterizations at both Scottrade and Vanguard before without any issues.

More Helpful Roth IRA information:

• 2010 Roth conversion
• Aggressive Roth IRA conversion strategy case study
• Tax treatment of Roth conversion
• How to Make Early Roth IRA Withdrawals

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