Any point to my using TurboTax?

[Aristippus]

Wanted to settle this question before tax season was again upon us. Here's the deal:

I've been doing my own taxes by just filling out the IRS's forms for nearly my whole tax-paying life (i.e., 30+ years); the only exception was a few extraordinarily complicated years (living abroad with a self-employed spouse while maintaining a rental property back home) when I used an accountant.

My taxes are back to being pretty simple: Wages and interest are our only income and, while we itemize, our only deductions are mortgage interest, other taxes, and charitable donations. I'd imagine lots of folks have a similarly simple situation. But, at this point, no one I know simply sits down with the 1040 and attendant forms and instructions and does their taxes; everyone I know who doesn't use an accountant uses TurboTax.

So my question is: what does TurboTax give me that my trusty scratch pad and pencil do not? Is there really any reason for me to spend money on it? Thanks in advance.

[MonkeyMama]

Taxes have gotten extraordinarily complicated over the last decade. To the point where I'd say it is virtually impossible to do by hand - even the simplest tax returns. The risk is that you will easily miss credits.

I can't speak for your state - ours is beyond insane in complication. It is possible there are states that keep things simple?

Thus, I would advise finding the cheapest software/online option to double check your work. Pay for federal filing only. Do state by hand, if possible. If you find that you are consistently not getting anything from the software, after a couple of years, you can drop it. You have to be extremely detail oriented to catch everything. I'd bet some sort of tax software will save you money in the long run, is all.

I am a tax preofessional. Last year my sister sent me her taxes to review. I threw them into my professional software very quickly (just some W-2s) and did not find any changes. BUT, she had initially missed some tax credits and told me she found $2000-ish in extra refunds after talking to a more tax-savvy co-worker. That is why she decided to send it to me to be sure - sounded too good to be true? I don't think her taxes could have been any easier. They had a couple of W-2s - she missed some tax credits or something. She had a tax education, to boot. Tax education is mostly useless if you don't constantly keep up with endless tax changes.

[Aristippus]

Interesting perspective. Our household income puts most tax credits out of our reach (while the cost of living in DC plus tuition at my daughter's incedibly expensive college keeps our finances "simple"), but perhaps there are some I don't know about. (on the other hand, in your example the tax software didn't actually help either). But I see your point.

[artwest]

My wife worked part time for a few years at H&R Block prior to our marriage. She has done our taxes for the past 7 years using TurboTax. For 5-10 years prior to our marriage, I did my personal taxes using TurboTax.

Needless to say, I recommend TurboTax.

[Aristippus]

Originally Posted by artwest

My wife worked part time for a few years at H&R Block prior to our marriage. She has done our taxes for the past 7 years using TurboTax. For 5-10 years prior to our marriage, I did my personal taxes using TurboTax.

Needless to say, I recommend TurboTax.

Okay, but why? I mean, I get that it simplifies things. But, honestly, my taxes are already incredibly simple: tally wages and interest, subtract easily-calculated deductions, subtract exemptions, and voila. What am I missing here (and why is it worth $60/yr)?

[seen]

I've used Turbotax for about 3 years now.

Since my taxes are also simplified I can use Turbotax's free version (Just sign up at Turbotax's website, and file online) for federal tax, albeit there is a $30 charge for the online state form/processing. You already know how things are done by hand, so in essence Turbotax has the following benefits that I can think of:

-Most questions are asked in a survey-esque format to facilitate what deductions you qualify for, with up-to-date info on what you can and can't do that particular year, etc.
-As you fill out your income, deductions, medical expenses, etc. for that year, the software auto-populates the forms for you so there's no mistake on what amounts go where.
-Your history/preferences are remembered from year to year. If you have no change in address the following year, no change in employer, no change in whatever else, Turbotax will have your forms all prepared for you so you need only input what's important/changed. This past year my taxes took less than an hour to do from start to finish.
-You can file your taxes electronically online via Turbotax's software. There is a processing fee of course (I can't remember the exact amount, but it's very small), and I don't know if this is possible elsewhere, but for me it's an incredibly handy feature as there's no snail mail, no manual intervention required.
-You can specify your bank account info so that when your return comes back it direct deposits into your bank. This is another really handy feature (for me anyway, can't speak for anyone else).
-Your completed return is available in .pdf format, so you can store it on your HD or print it out if you desire.

The best part for me is that from start to finish, and for record keeping not a single piece of paper is involved. That to me is absolutely worth the 30 something dollars.

[jpg7n16]

You should do it by hand 1st, and then fill out the online version of TurboTax. See if you missed anything. With TurboTax online, you don't pay until you file.

If their calculations and software help you save more on taxes than the software costs, wouldn't it be worth it to buy?

From: TurboTax® - Personal Income Taxes, Income Tax Returns, Tax Return, File Taxes Online

If you use TurboTax Online or SnapTax:
Satisfaction Guaranteed—or you don't pay. You may use TurboTax Online or SnapTax without charge up to the point you decide to print or electronically file your tax return. Printing or electronically filing your return reflects your satisfaction with TurboTax Online or SnapTax, at which time you will be required to pay or register for the product

I personally use TurboTax because I have a brokerage account that I do a little trading in, receive dividends, interest, etc.

There's no way I would want to take all that info and do it by hand. Much more convenient to click the 'import from brokerage' button, and let the software do it for me.

[GrimJack]

I used to use Turbo-Tax but now I use the 'Free File' option at IRS.gov. There is not state income tax here in WA so I file for free.

[krantcents]

Turbo tax asks the right questions and does the arithmetic for you. They also electronically file for you. In essence, it saves you time and makes it more accurate.

[MonkeyMama]

Originally Posted by jpg7n16

You should do it by hand 1st, and then fill out the online version of TurboTax. See if you missed anything. With TurboTax online, you don't pay until you file.

That's an interesting point. So you can double check your work without paying for it? That's a good tip. If results are similar, just do it by hand - no money paid. You'd only pay if you were able to save taxes in the process.

[ActYourWage]

Originally Posted by MonkeyMama

That's an interesting point. So you can double check your work without paying for it? That's a good tip. If results are similar, just do it by hand - no money paid. You'd only pay if you were able to save taxes in the process.

Yes. You can check before you pay. Also, I like TurboTax, because it keeps your history year to year and knows the "right" questions to ask if tax laws changed the past year.

[Slug]

Originally Posted by ActYourWage

Yes. You can check before you pay. Also, I like TurboTax, because it keeps your history year to year and knows the "right" questions to ask if tax laws changed the past year.

I also use TT and like it for that reason as well as for jpg7n16's since I trade a bit too in a taxable account.

[Aristippus]

Originally Posted by jpg7n16

You should do it by hand 1st, and then fill out the online version of TurboTax. See if you missed anything. With TurboTax online, you don't pay until you file.

If their calculations and software help you save more on taxes than the software costs, wouldn't it be worth it to buy?

This is a great tip; I'm going to try this. I'll report the results. Thanks to you and everyone who responded!

[SnoopyCool]

Delete.

[Frügal]

You know, TurboTax will tell you which service of theirs you need. Chances are you'll file for free, and just pay for the direct deposit (if you want it, that is). I always do it this way.

[GrimJack]

Originally Posted by Frügal

You know, TurboTax will tell you which service of theirs you need. Chances are you'll file for free, and just pay for the direct deposit (if you want it, that is). I always do it this way.

Do you have to get there from 'free file' to get it for free? Or can you get TT for free going directly to their site?

[Frügal]

Originally Posted by GrimJack

Do you have to get there from 'free file' to get it for free? Or can you get TT for free going directly to their site?

You can go thru Free File via the IRS here: Free File: Do Your Federal Taxes for Free
Or, alternately, you can do it thru TurboTax here: TurboTax® Free Taxes Online, Free Tax Return, Free Federal Tax Filing, Free efile

Keep in mind, though, that state taxes are not free. I don't think such a thing exists. Haha.

[Aristippus]

Originally Posted by Frügal

You can go thru Free File via the IRS here: Free File: Do Your Federal Taxes for Free
Or, alternately, you can do it thru TurboTax here: TurboTax® Free Taxes Online, Free Tax Return, Free Federal Tax Filing, Free efile

Keep in mind, though, that state taxes are not free. I don't think such a thing exists. Haha.

Looks like free file has an income cap for use, but TurboTax does not.

[Frügal]

Originally Posted by Aristippus

Looks like free file has an income cap for use, but TurboTax does not.

I wouldn't know about income caps. We live below the poverty level.