Turbo Tax vs. (your opinion here)

[DrtyRat]

So I'm about to do my taxes, and as I've done every year, I try to coordinate my schedule with my wife's so that we can visit the account and get our taxes done. I was at work talking with some of my employees and they started making a case for turbo tax. I heard how easy it was, and that it basically figures out everything for you (i.e. what my accountant would normally do). So I got to thinking about it and wanted some input on it. The thing is, when it comes to doing my taxes, I'm a straight up person. I'm not looking to scam the "system", but I'd like to take advantage of what I truelly qualify for. I don't have a ton of write-offs, I own a home, my wife has been a full time student, for the last year, etc. So do you think its better to save some money and go through turbo tax, or will an account "find" more?

[SimpleS14]

The right accountant will always find more by working the system.


I've used Tax Cut (H&R Block online) for years and it's very straight forward and simple.


However, I just closed on some property and I plan to go to an accountant when I file next year.


You can always use these online systems to find out how much you will earn (or pay) before actually filing.

[Modrified]

i've used turbo tax for the first time this year. it was also my first time doing my taxes on my own. until this year, i was being filed under my parents. anyway, i really like turbo tax. it was very easy and quick. all you have to do is put the correct information and you will be fine. i filed already and received my federal tax return within two weeks after i filed. every thing was filed online. i didn't have to print and sign anything. i did however print and sign for my state tax as it does not yet accept electronic filing. it might be different for you state however. but the main thing is the federal tax return can be done all online.

it was very simple for me however as i do no have any complication. i would suggest that if you sold or bought properties, or even sold stocks, i would suggest seeing a pro, but if just simple filing as me where i just had to report whats on my w2 and student loan information as i am a student. turbo tax will be more than what you need and plus it is reasonably cheap. you can choose to pay up front when it is filed using a credit card or you may choose turbo tax to take their payment from your tax return.

i think the coolest feature for turbo tax is you know how much you will get on your tax return before you file it. the turbo tax system tells you how much you will get real time. the number or amount you will get for federal and state will be constantly shown on top of the page and it goes up or down after you have inputted the information that it is being asked.

[TheWolf]

I've used turbo tax for several years. It works great. The knock is that it doesn't "suggest" ways for you to cut your taxes. Like for instance. If you were like 2k into the next higher tax bracket and hadn't contributed the max to your 401k. You could "contribute" 2k and then be at a lower bracket. These kinda things it doesn't do. As for the 450000 deduction people. I'm one of them. Every shirt I give to goodwill. Every dollar I put in the church basket. My wife at the end of the year whips out this folder of receipts. Blamo. Gets it done. But I also get the "deluxe" model to do that. The basic doesn't. I'm also in florida. No state taxes.

[doogstein]

With you being a home owner and your wife a full time student I'd definitely go see an accountant. My buddy did his taxes on turbotax as a full time student and they got him back $1600. Then he decided to go to an accountant and he went through everything as far as deductions go (books, supplies, tuition etc..) and got him $3900. Maybe you can see what turbotax will get you back and then see the accountant and see how much of a difference it is. If the accountant only gets you back a few hundred more but charges $400 to do it then it's worth it to file through turbotax. Thats just my .02

[HyperTek]

find turbotax deluxe on torrent sites =)

[g6civcx]

o do you think its better to save some money and go through turbo tax, or will an account "find" more?

The US tax code is the most complicated legal system in the entire world.

I recommend you get a good accountant for liability reason no matter how aggressive you want to be on your filing.

If you get audited, you need someone to step up and take responsibility for your filing.

Does Turbo Tax or your accountant do that for you?

[DrtyRat]

I'm not sure what you mean by : "I recommend you get a good accountant for liability reason no matter how aggressive you want to be on your filing." If you are trying to imply that I want to work the system, I can assure you I'm not. I just wanted some opinions on those who may have gone through both options, and their recommendations

[sirfallsalot243]

I'm not sure what you mean by : "I recommend you get a good accountant for liability reason no matter how aggressive you want to be on your filing." If you are trying to imply that I want to work the system, I can assure you I'm not. I just wanted some opinions on those who may have gone through both options, and their recommendations

Call it what you want, but you do have options on "how aggressive" you want to be. Doesnt necessarily mean "cheating the system," but there are ways to write certain things off legally that turbo tax wont find. What, and how much you write off is entirely up to your morals, and how afraid you are of an audit. I never write anything off that I cant account for, but I write off as much as I can.

[axiomatik]

I've used turbo tax for several years. It works great. The knock is that it doesn't "suggest" ways for you to cut your taxes. Like for instance. If you were like 2k into the next higher tax bracket and hadn't contributed the max to your 401k. You could "contribute" 2k and then be at a lower bracket. These kinda things it doesn't do. As for the 450000 deduction people. I'm one of them. Every shirt I give to goodwill. Every dollar I put in the church basket. My wife at the end of the year whips out this folder of receipts. Blamo. Gets it done. But I also get the "deluxe" model to do that. The basic doesn't. I'm also in florida. No state taxes.

That's not how the tax bracket system works. The US tax system uses a Marginal Tax Rate. That means that only the money earned within a certain tax bracket is taxed at that rate. These are the tax brackets for 2009 if you are single:

10%: $0-8,025
15%: $8,026-32,550
25%: $32,551-78,850
28%: $78,851-164,550
33%: $164,551-357,700
35%: $357,701+

For example, if you earned $100,000 dollars a year, $8,025 of your income is taxed at 10%. $24,525 (32,550 minus 8,025) is taxed at 15%. $46,300 (78,850 minus 32,550) is taxed at 25%. And finally $21,150 (100,000 minus 78,850) is taxed at 28%. So, your total tax bill, before counting any deductions or credits or 401k contributions or anything, is:

8025 x 0.10 = 802.5
24525 x 0.15 = 3678.75
46300 x 0.25 = 11575
21150 x 0.28 = 5922
Total tax bill: $21,978.25 = ~22% effective tax rate (21,978 / 100,00)

Even though someone making $100k a year is in the 28% "tax bracket", that isn't really what they are paying in taxes. Being bumped into a higher tax bracket doesn't really matter, because only the income earned above that threshold is taxed at that higher rate. Anything earned below that threshold continues to be taxed at the lower tax brackets. It is purposely written that way to prevent situations where entering a higher tax bracket results in less take-home income.

Once you start factoring in deductions and credits, it can drop significantly, especially if you own a home and/or have a child. For example, I'm an engineer, my wife is a microbiologist, we make pretty good money. We own a home and have one child. When we did our 2009 taxes, our effective federal tax rate (what we ended up paying to the IRS divided by our gross pay) was 11.5%. And that was actually a big step up from the previous year when it was 9.75% (the increase was due to the fact that I hadn't been eligible for my employer's FSA program in 2009).

With you being a home owner and your wife a full time student I'd definitely go see an accountant. My buddy did his taxes on turbotax as a full time student and they got him back $1600. Then he decided to go to an accountant and he went through everything as far as deductions go (books, supplies, tuition etc..) and got him $3900. Maybe you can see what turbotax will get you back and then see the accountant and see how much of a difference it is. If the accountant only gets you back a few hundred more but charges $400 to do it then it's worth it to file through turbotax. Thats just my .02

A good tax program will explain what you can deduct, even for full-time students. I've used Tax Cut for years (now H&R Block), and it lists what you can deduct as a full-time student. There are limits to what you can deduct, you can't just deduct everything you spend money on while a student.

Call it what you want, but you do have options on "how aggressive" you want to be. Doesnt necessarily mean "cheating the system," but there are ways to write certain things off legally that turbo tax wont find. What, and how much you write off is entirely up to your morals, and how afraid you are of an audit. I never write anything off that I cant account for, but I write off as much as I can.

Unless you are self-employed or have some sort of alternate income source like rental property, what you can deduct is pretty cut and dry. Unless you are a homeowner, for the most part it makes more sense to take the standard deduction, because it will most likely be higher than anything you can itemize. Once you are a homeowner, or have substantial student loans, you will start to have itemized deductions that can be higher than the standard deduction.