Tax prep?

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JOhnH

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What is the best way to do personal taxes these days?

Back when I owned a business my taxes could be quite complicated so I had the CPA that did my company taxes also do my personal taxes.
When I sold the business I kept letting him do my personal taxes. For the first few years they could be quite involved. But these days my taxes are quite simple. More than a short form, but only schedule 1 and schedule E, with one entry on each.

Then my accountant sold his business and last year the new guy raised his rate about 15%. Then this year he raised the rate another 15% AND charged me a $50 bucks for a very simple question (How much funds to withdraw from IRA to keep from bumping up my IRMAA payment. It was a calculation that involved adding up four numbers and subtracting from an IRS published figure. And I gave him all the figures. I could have easily done it myself but I wanted a confirmation that I was doing it right.

So next year I want to do them myself. I'm not comfortable with a pen and paper so TurboTax? Some on-line program? What is best and costs less than $600?
 
I use H&R Block's software. It's like $35 per year for Fed and State. There's a chart they have that tells you what you get for each of the different versions. I have no complaints.
 
H&R Block for me. The earlier you buy it, the less it costs. I don't get the State return, my State has a decent online filing system and I have a pretty simple return. So I do the H&R Block for Fed, then go to my State website afterward.

And yes, you can do it free on the IRS site.
 
Bob Noel said:
If you can read the instructions, it's pretty simple.
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Yeah, see! That's the rub. IRS instructions have never been what I have considered "simple".

When I was looking over my return I was wondering why he used $30,700 for my standard deduction. The instructions clearly state the deduction is $27,500.
But if you are over 65 or blind you get an extra $1,500 deduction. I might or might not have missed that.
 
Matthew said:
H&R Block for me. The earlier you buy it, the less it costs. I don't get the State return, my State has a decent online filing system and I have a pretty simple return. So I do the H&R Block for Fed, then go to my State website afterward.

And yes, you can do it free on the IRS site.
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Do you save money by not using their state tax forms? My State has no income tax.

And does the IRS site prompt you for deductions you may have missed? Or is it just a fill in the blank version of 1040? Would it have caught the extra standard deduction I mentioned in my previous post?
 
H&R Block is who we used for years, but we had a relationship with an Enrolled Agent with decades of experience.

Their tax prep service is fine, but tax advice isn’t their forte.

On the prep side, you can upload, drop off, or do an initial appointment to address concerns and come back later to sign.

They’re in the sub $600 range locally.
 
JOhnH said:
Do you save money by not using their state tax forms? My State has no income tax.

And does the IRS site prompt you for deductions you may have missed? Or is it just a fill in the blank version of 1040? Would it have caught the extra standard deduction I mentioned in my previous post?
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You buy the Federal package, I don't remember what it costs, maybe $30? But once you buy it and register it, you'll start getting email reminders around December. I think if you buy it again in Dec, it's $15, then $20 in Jan, something like that.

If you want to do a State return, it's something like an additional $30. But since I use my own State online form, I don't pay extra for the State.

H&R Block says you can do up to 5 individual returns with one package. I can't remember if our daughter used it one year to do hers.

H&R Block and Turbo Tax both are similar - they walk you through an "interview". Once you finish answering the questions and entering the values off your 1099s and other forms, you are pretty much finished. I haven't used TT for years, so I can't say much about them. They will both import data from your last year's forms so you can save some time having to enter some information. They can also import 1099 information from a lot of financial institutions, but I have had only minimal luck with that. My employer's payroll company wasn't a member of whatever banking institution HR Block uses, so I couldn't simply import all that info and I had to enter it manually. Not a big deal. Same with some of the 1099 forms - I couldn't get access to some of them by downloading through the tax package.

I'm not a tax expert, but I do know what my own particulars involve, and HRB works for me.
 
DaleB said:
I spend the $45 or so once a year do buy TurboTax. Have been doing so for a long time.
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It sounds like with just a little effort I could save enough money to buy about 80 gallons of avgas.
 
DaleB said:
I spend the $45 or so once a year do buy TurboTax. Have been doing so for a long time.
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Same here. Although these days I rarely get above the standard deduction and don't have many complications that really necessitate using TurboTax. I generally have it compile the state forms, but then mail it in later as a usually end up owing State taxes and don't want to e-file it.
 
JOhnH said:
Yeah, see! That's the rub. IRS instructions have never been what I have considered "simple".

When I was looking over my return I was wondering why he used $30,700 for my standard deduction. The instructions clearly state the deduction is $27,500.
But if you are over 65 or blind you get an extra $1,500 deduction. I might or might not have missed that.
Click to expand...

With all due respect, if you are concerned about missing something like the standard for your age or aren't comfortable comparing itemized deductions vs the standard deduction, then, sure you are probably better off buying a software package or having a professional do your taxes. It sure sounds like you'd be more confident/comfortable.

My taxes are dirt simple, a couple of 1099-R forms, a 1099-int, a 1099-G, Schedule B, Schedule A, Schedule 1. In some ways it would be easier for me to file paper forms, but I'm expecting a refund, so electronic filing gives me my (small) refund much much faster - that last time I filed paper forms, it only took the IRS 29 months to give my refund.
 
JOhnH said:
What is the best way to do personal taxes these days?

Back when I owned a business my taxes could be quite complicated so I had the CPA that did my company taxes also do my personal taxes.
When I sold the business I kept letting him do my personal taxes. For the first few years they could be quite involved. But these days my taxes are quite simple. More than a short form, but only schedule 1 and schedule E, with one entry on each.

Then my accountant sold his business and last year the new guy raised his rate about 15%. Then this year he raised the rate another 15% AND charged me a $50 bucks for a very simple question (How much funds to withdraw from IRA to keep from bumping up my IRMAA payment. It was a calculation that involved adding up four numbers and subtracting from an IRS published figure. And I gave him all the figures. I could have easily done it myself but I wanted a confirmation that I was doing it right.

So next year I want to do them myself. I'm not comfortable with a pen and paper so TurboTax? Some on-line program? What is best and costs less than $600?
Click to expand...
How "simple" is your situation?

If you have any of the audit flags in your return or if you have complicated or multi-state income it might be worth considering using a different pro.

For me, using a pro gives me the peace of mind that if something goes wrong, he will be there with me to explain why we claimed things the way we did. He has also pointed out ways to do things that are obvious in hindsight, but that I never would have thought of my myself.
 
My new employer provides tax services if we have worked in 3 or more states, since we have state taxes withheld based on where we log our hours (and yes, it does check - if you have travel or expenses booked to a specific state and then try to log time to a different state, it flags it when you submit your timesheet). I'm still on the fence of whether I want to use it or not. I've been using TT for what seems like forever, so I'm pretty comfortable with it at this point, but it is ~$30 per state and I have 4 or 5 states to submit this year.
 
Downside to TurboTax....they "upgrade" the internals of the software every year and your hardware my not satisfy the minimum specs. I will not buy a new computer or upgrade the OS to keep TT happy. They depend on the inertia of customers to move to another product. I tried H&R Block couple years ago and will probably move to it next year, when TT tells me I can't run it's software on a Mac M1 chip with a 1 version back OS.
 
murphey said:
Downside to TurboTax....they "upgrade" the internals of the software every year and your hardware my not satisfy the minimum specs. I will not buy a new computer or upgrade the OS to keep TT happy. They depend on the inertia of customers to move to another product. I tried H&R Block couple years ago and will probably move to it next year, when TT tells me I can't run it's software on a Mac M1 chip with a 1 version back OS.
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Most all of TurboTax is online now. They really don't want you downloading software anymore, it's a headache for them to manage and update. Easier to just force it onto an online portal so they can manage it all in one location with no hardware specs to worry about.
 
SoonerAviator said:
Most all of TurboTax is online now. They really don't want you downloading software anymore, it's a headache for them to manage and update. Easier to just force it onto an online portal so they can manage it all in one location with no hardware specs to worry about.
Click to expand...

Yeah. I was about to say that I don't remember the last time I actually installed TT on my PC. It's been online for quite a while now.
 
CJones said:
Yeah. I was about to say that I don't remember the last time I actually installed TT on my PC. It's been online for quite a while now.
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I install it on my PC every year... haven't tried the online version yet.
 
I've been using Turbotax for many years. It's kind of expensive, but familiarity is a plus. My taxes are semi-complicated because I have to pay taxes in two states, one of which, unfortunately, is California, which requires me to jump through all kinds of hoops and fill out stacks (if printed) of forms before reaching the predictable calculation of about $50/year. I've been using the CDs because I have a slow connection at home, but it always wants to download updates, so that doesn't really save me much. I should move online, but haven't yet.
 
DaleB said:
I install it on my PC every year... haven't tried the online version yet.
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judypilot said:
I've been using Turbotax for many years. It's kind of expensive, but familiarity is a plus. My taxes are semi-complicated because I have to pay taxes in two states, one of which, unfortunately, is California, which requires me to jump through all kinds of hoops and fill out stacks (if printed) of forms before reaching the predictable calculation of about $50/year. I've been using the CDs because I have a slow connection at home, but it always wants to download updates, so that doesn't really save me much. I should move online, but haven't yet.
Click to expand...

Heh. I was just looking around and out of all the PCs (4 laptops + 1 desktop), I don't think we have a CD drive in any of them. How/when did that happen!?
 
CJones said:
Heh. I was just looking around and out of all the PCs (4 laptops + 1 desktop), I don't think we have a CD drive in any of them. How/when did that happen!?
Click to expand...
Those drives take up a lot of space. You can buy an external drive and connect via USB, then let it accumulate dust in the closet between the few times you'll need to use it.
 
CJones said:
Heh. I was just looking around and out of all the PCs (4 laptops + 1 desktop), I don't think we have a CD drive in any of them. How/when did that happen!?
Click to expand...
Baked Potato said:
Those drives take up a lot of space. You can buy an external drive and connect via USB, then let it accumulate dust in the closet between the few times you'll need to use it.
Click to expand...
I've got one computer left that has a CD/DVD drive in it. I used to use that for Turbotax, but the last couple of years I just downloaded it.
 
I've been thinking about doing something different. I've been doing them on paper (well, on pdf then printed) since I started filing. Each year getting more complex. I think it was around 30 pages last year. I spend most of February on it, as I have to file by March 15.

Most farmers use an accounting service that's run by the university of Illinois. Downsides of that are that they want you to use their accounting software, and it's something like 3k/year. I also find that the guys who use it don't understand the tax ramifications of their decisions and end up calling "their guy" and asking for permission. The biggest benefit I see is that if you get audited, they have to deal with the irs.

Last time I tried turbo tax I found it frustrating, but that was probably ten years ago.
 
Jim K said:
I've been thinking about doing something different. I've been doing them on paper (well, on pdf then printed) since I started filing. Each year getting more complex. I think it was around 30 pages last year. I spend most of February on it, as I have to file by March 15.

Most farmers use an accounting service that's run by the university of Illinois. Downsides of that are that they want you to use their accounting software, and it's something like 3k/year. I also find that the guys who use it don't understand the tax ramifications of their decisions and end up calling "their guy" and asking for permission. The biggest benefit I see is that if you get audited, they have to deal with the irs.

Last time I tried turbo tax I found it frustrating, but that was probably ten years ago.
Click to expand...

My biggest gripe with TT is the constant (and sometimes covert) attempts to upsell beyond the standard service. Their UI is pretty straightforward and seems like it's gotten a little better every year. Of course, I don't go off into the weeds of depreciated assets and capital gains/loss type stuff, so I can't speak to how polished those areas are.
 
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