Four Must Have Tax Apps

The Four Must Have Apps to thrive under the new Tax Law

Happy Tax Season, everyone! I say that with only a little irony as many of you are already strategizing the best way to spend those refund checks. If you’re like me (and I know I am) then the windfall, large or small, will pay for some project around the house and not a down payment on my Tesla, which will be blue.

What you may not know, and what tax professionals are struggling through now, is how much of an impact the 2017 Tax Cuts and Jobs Act will have on that refund. Many of the impacts of the largest tax code overhaul in decades are just now being seen by early filers, and the consensus is that expected refunds are going to drop significantly for most of us.

The good news is that there are steps you can take today to boost your refund for next year, and these four must-have tax apps can help!

Step 1: Adjust your withholding with PayCheckup ($2.99 on iTunes)

The way most of us receive refunds is through tax withholding on our paychecks, based on tables the IRS puts out every year. The new tax law significantly altered those tables, which is why so many people’s refunds will drop (or disappear entirely) on their 2018 return. If you want to avoid the same situation on your 2019 return, now is the time to evaluate whether you’re having enough tax withheld.

The PayCheckup app uses your current paycheck data to forecast your 2019 tax bill. It guides you through entering basic pay data from your current pay stub, and lets you run different projections to see how changing your withholding will affect your refund. If you want to change your withholding allowances, it will produce an updated withholding form (W-4) to give to your payroll department.

The app costs $2.99 to download and includes annual rate updates for no additional charge.

Step 2: Keep better records of your donations with ItsDeductible (Free on iTunes)

Despite changes in the standard deduction rate, many filers can still take advantage of deducting donations to charity on their Federal or State returns. To take the deduction you must keep receipts, and non-cash donations are tricky because you also have to estimate the value of your donation. The ItsDeductible app from Intuit (makers of Turbotax) makes it easy to track cash, non-cash and charity miles in one place.

ItsDeductible allows you to log your donations in one place and produces annual reports to make tax prep easy. The really cool feature for non-cash donations is the comprehensive list of household items with values attached that lets you estimate the total value of your donations very easily.

The app is free to download, and requires a login from Intuit (because they are trying to get you to buy TurboTax), but a great tool all the same.

Step 3: Don’t miss out on deducting mileage - track business, medical and charity mileage with MileIQ (Free for 40 trips per month / $5.99 for unlimited trips)

Mileage is one of the most often overlooked tax deductions that could save you thousands of dollars each year. In 2019 you can deduct:

  • 58 cents per mile for business (including managing rental properties)

  • 20 cents per mile for medical / moving expenses, and

  • 14 cents per mile driven for charitable organizations

The main requirement to claim this deduction is to maintain a log of miles driven that includes the date, purpose, destination and actual mileage of each trip. Most mileage tracking apps meet these criteria, but MileIQ stands out with its great user interface that allows you to quickly log and categorize mileage, the use of GPS to track actual miles driven, and dashboard that summarizes your annual mileage log for tax purposes.

The basic version is free and includes 40 recorded trips per month, which is enough for many small business owners. The $5.99 version includes unlimited trips which is ideal for people in jobs that require a lot of travel, like sales or real estate.

Step 4: Track your refund, stay up to date on changes and free filing resources with IRS2Go (free on iTunes)

Believe it or not, the IRS has an app and its not that bad! The IRS2Go app lets you check on the status of your refund, pay estimated taxes, find free tax filing resources, and receive tax tips and updates. You can access additional features from IRS.gov through their secure login.

There are services out there that charge users a fee to pay their tax bill. Before you use those, I highly recommend you check out the free IRS2Go app.

John Hermanson