Author Topic: Taxes, do you DIY?  (Read 19461 times)

greenmimama

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Taxes, do you DIY?
« on: February 10, 2014, 01:19:04 PM »
We used to do our taxes ourself, then for the last maybe 8 years we have had somebody do them for us, they were complicated and we had adoption tax credits for about 6 of those years, but now we have 1 W2, own a home and have children, so I am thinking I could use Tax Act or something similar and do them myself. I kind of feel like I do all the work with gathering all the info anyways.

What do you think? Those dumb commercials on TV scare me though "Americans leave a Billion dollars on deductions they could have used, come to H&R Block and get you r Billion back" I want to save money doing my own taxes, I don't want to lose money by trying to dave some, make any sense?

5inatrailer

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Re: Taxes, do you DIY?
« Reply #1 on: February 10, 2014, 01:24:49 PM »
You could do both as an experiment:

open a Ufile online account for free and enter the relevant fields and see what your return is, then go to H&R block or a decent accountant and see what your return is from them. You'll know better for next year. The more you can do your self, the more you save.  However, the more complicated your return is, the more it will cost someone else, which is offset by opportunities for better tax strategies/ return.

I like doing them myself as it gives me a very good understanding of tax savings/ writeoffs etc. We have a home based business (30k gross), 3 kids, and 3 employers.  Not too hard.

N

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Re: Taxes, do you DIY?
« Reply #2 on: February 10, 2014, 01:39:56 PM »
I did them myself this year and last year.  Last year we had one w-2, one 1099 for mortgage interest, two kids. It was pretty simple, and there are free online forms on the irs website. I was very thorough and read everything a zillion times to make sure I understood  each line, etc. but overall, not too bad. This year was very straightforward as well. Then you can efile and if you have made any kind of error filling it out, they reject it (happened to me a couple times because I put zeros where it should have been blank. but they give you a form that explains the errors, etc.) then it finally "took" and the refund will get direct deposited to my checking. I already got my state tax refund back.

if you arent having a lot of itemization and deductions, its pretty hard to leave money behind.

markstache

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Re: Taxes, do you DIY?
« Reply #3 on: February 10, 2014, 02:38:18 PM »
I like Taxact. I've used it for two years running. You don't have to pay up front, so if you don't feel comfortable at the end you can walk away for no cost.

In general, I'd suggest going through the 1040 form line by line. If nothing there seems strange or you feel like you wouldn't know what to put there, you can be pretty sure that something like Taxact or doing it by hand would be sufficient. If it doesn't seem to cover you and the stack of forms you've received from other entities, perhaps an accountant would be good. From the one time I had an accountant, I got the impression he basically just used a software system like Taxact. Then again, I was probably not as hard a tax case as I thought I was.

Cheddar Stacker

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Re: Taxes, do you DIY?
« Reply #4 on: February 10, 2014, 02:44:03 PM »
What do you think? Those dumb commercials on TV scare me though "Americans leave a Billion dollars on deductions they could have used, come to H&R Block and get you r Billion back" I want to save money doing my own taxes, I don't want to lose money by trying to dave some, make any sense?

This community can help you with finding those billion dollar deductions. Check out the optimize your taxes thread. Many, many great insights. If you have questions, just add them to the end of that thread, but it has tons of great ideas on optimization. Good luck.

EDIT: I DIY, but it's what I do for a living. A lot of people here are very knowledgeable though and I'm sure many do it themselves. I'd bet it's over 60-70% are DIY in this area.
« Last Edit: February 10, 2014, 02:46:22 PM by Cheddar Stacker »

MountainFlower

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Re: Taxes, do you DIY?
« Reply #5 on: February 10, 2014, 02:44:36 PM »
I use taxact online and have for about 8 years.  As mentioned, you can do it for free and see what you think.  You have to pay to actually file and to create the forms.  It's less than $20 for state and federal. 

the fixer

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Re: Taxes, do you DIY?
« Reply #6 on: February 10, 2014, 04:13:01 PM »
Do you have copies of your previous years' tax forms? If so, that's your template for this year to do them yourself. Just read the instructions so you understand which numbers your tax preparer put where, and why. If not, ask your tax preparer for them; there must be copies somewhere in case you get audited.

The only tricky part is your deductions. Whether or not you choose to itemize depends on how many itemized deductions you can come up with. With a house, it's possible you have enough but maybe not? Always compare to the standard deduction (and depending on your income the AMT) to see if it's worth it. If you do itemize, then there may be lots of little things you can deduct that you might not realize. Previous years' records will help with this but not as much.

Abe

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Re: Taxes, do you DIY?
« Reply #7 on: February 10, 2014, 04:34:25 PM »
I've done it both ways, and found that if you do it manually, reading through all the stupid rules about deduction and credit phase-outs are mind-numbing.  I used HR Block's program for years and it takes maybe half-hour for my parents' and my taxes. That being said, I did read through the 1040 instructions once just to make sure there isn't anything obvious being left out.

TomTX

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Re: Taxes, do you DIY?
« Reply #8 on: February 10, 2014, 05:49:32 PM »
I've done it both ways, and found that if you do it manually, reading through all the stupid rules about deduction and credit phase-outs are mind-numbing.  I used HR Block's program for years and it takes maybe half-hour for my parents' and my taxes. That being said, I did read through the 1040 instructions once just to make sure there isn't anything obvious being left out.

Block tried to leave out my retirement savings tax credit (Saver's Credit) last year. I had to go search out the form and manually run through it.

Caoineag

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Re: Taxes, do you DIY?
« Reply #9 on: February 10, 2014, 08:03:43 PM »
Been doing my own taxes for 14 years. Taxact is great, walks you through it and you can run scenarios. We have had a few interesting tax years. In fact, I think those might outnumber the boring years to be quite honest (2 partials states in one year, various education related credits and deductions, jury pay, unemployment pay, self-employment, etc).

Big thing about doing it yourself, especially if you use software is that you can educate yourself on what do throughout the year to cut your bill. Having a professional do your taxes doesn't allow you to figure that out.

TreeTired

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Re: Taxes, do you DIY?
« Reply #10 on: February 10, 2014, 08:08:22 PM »
What does your tax accountant actually do?    I lived overseas for years and my company paid to have my very complicated taxes done.  When I returned to the states the taxes remained complicated for a few years, but then got simpler each year.  More recently I got the distinct impression that my tax accountants were simply plugging my numbers into a canned program that really wasn't much different from TaxActonline,  which I have now been using for the past several years.

Cheddar Stacker

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Re: Taxes, do you DIY?
« Reply #11 on: February 10, 2014, 09:20:41 PM »
What does your tax accountant actually do?    I lived overseas for years and my company paid to have my very complicated taxes done.  When I returned to the states the taxes remained complicated for a few years, but then got simpler each year.  More recently I got the distinct impression that my tax accountants were simply plugging my numbers into a canned program that really wasn't much different from TaxActonline,  which I have now been using for the past several years.

For the average Joe, tax accountants do just what you said. People on this site are not average Joe's since they are very smart, and willing to learn new skills, particularly if it saves them money, both tax prep fees and taxes due to increased awareness of potential deductions throughout the year.

Tax accountants provide much more to the non-average Joe. Either the "I have no idea how to figure this out, here just take it" people, or the people that have 25 K-1's, 12 brokerage accounts, and more money than they know what to do with. They're not for everyone, but for some they are an absolute must. OP doesn't appear to need the help of a tax accountant.

Tami1982

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Re: Taxes, do you DIY?
« Reply #12 on: February 11, 2014, 12:47:37 AM »
My income is so low that my deductions (even with a student loan and a mortgage) never get me over the standard deduction.  I basically file  1040 EZ.  Stupid simple.   But I also do my parents, brother, and uncle's every year too.  As long as what you are filing is pretty basic, some w-2, charitable stuff, maybe 1099's and such, those free programs really walk you through it very easily.

exranger06

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Re: Taxes, do you DIY?
« Reply #13 on: February 11, 2014, 07:27:32 AM »
Two of my uncles are accountants that work in the same office. They do my taxes each year for free. :)

catccc

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Re: Taxes, do you DIY?
« Reply #14 on: February 11, 2014, 07:56:08 AM »
I DIY, but I'm a CPA and used to do them professionally.  I use tax act to e-file federal for free, and then do the state by hand. 


soccerluvof4

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Re: Taxes, do you DIY?
« Reply #15 on: February 11, 2014, 08:22:35 AM »
Does anyone know the formula or have a link to deducting your home office? We own our own business but even though I am ER and my wife goes to the office building 25-30 hours a week I still collect a paycheck and our in-home office is solely used as an office now.

Thanks in advance!

Exflyboy

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Re: Taxes, do you DIY?
« Reply #16 on: February 11, 2014, 10:40:14 AM »
Interesting..

I use a very knowledgable CPA but have been learning a ton from experts on this site such as Cheddar Stacker.

I think I will still use the CPA this year. I have quite a lot of earnings from last year, some stock losses that are coming to an end this year, two rentals and a farm business.

the thing that concerns me the most is re-creating all the depreciation tables for refrigerators, lawn mowers etc.

Does Taxact help you do all this stuff?.. I might double check my CPA's numbers with Taxact and do my own next year.

Thanks

Frank

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Re: Taxes, do you DIY?
« Reply #17 on: February 11, 2014, 12:49:02 PM »
I use Turbo Tax. It's plug, play and pay.

enigmaT120

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Re: Taxes, do you DIY?
« Reply #18 on: February 11, 2014, 04:05:43 PM »
I use Turbo Tax. It's plug, play and pay.

A guy at work lets me use his copy.  Easy.  Before that I did it myself on paper.  I like doing my taxes, but I don't think I would like doing anybody elses.


the fixer

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Re: Taxes, do you DIY?
« Reply #19 on: February 11, 2014, 04:45:19 PM »
Does anyone know the formula or have a link to deducting your home office? We own our own business but even though I am ER and my wife goes to the office building 25-30 hours a week I still collect a paycheck and our in-home office is solely used as an office now.

Thanks in advance!
To me that sounds complex. You and your wife share the office, but your wife commutes to a primary work location somewhere else. So the question is, is the home office actually a primary work location? It has to be in order to deduct it. If it was just your wife, this would not be deductible.

Disclaimer: All I know about the home office deduction is what I read in an old version of http://www.amazon.com/Deduct-Lower-Small-Business-Taxes/dp/1413317588 that I picked up at Goodwill.

greenmimama

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Re: Taxes, do you DIY?
« Reply #20 on: February 11, 2014, 05:10:26 PM »
Thank you everyone, looks like I will use Tax Act and then see what it does, the other reason I hate using a Tax guy is because no matter when I give him our paperwork, he doesn't file it till almost April 15th and with all of our previous adoption credits we were getting big refunds.

Exflyboy

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Re: Taxes, do you DIY?
« Reply #21 on: February 12, 2014, 11:06:57 AM »
Yes Turbo tax is pretty expensive with the filing fee.. Tax act is much cheaper I just don't know how well it will cope with business depreciation schedules etc.

Frank

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Re: Taxes, do you DIY?
« Reply #22 on: February 12, 2014, 01:02:22 PM »
What does your tax accountant actually do?    I lived overseas for years and my company paid to have my very complicated taxes done.  When I returned to the states the taxes remained complicated for a few years, but then got simpler each year.  More recently I got the distinct impression that my tax accountants were simply plugging my numbers into a canned program that really wasn't much different from TaxActonline,  which I have now been using for the past several years.

You should pay an accountant to help you with TAX PLANNING not tax filling!!!

If you only talk to your accountant when filing your taxes, you are missing out on the purpose of an accountant. I pay over $300 per year to meet with a local guy and if he was only filing my taxes it would be a total rip off.

They are worth it because they will help you come up with tax planning strategies that you implement in June. Go visit your accountant in June or September and say "what can we do to maximize for this year?" Most of them wont charge you for that meeting and that is where they will prove their worth.

Personal examples:
1) We got a free college course because it would push my wife over the "full time" threshold and then we could deduct all "living-at-home" expenses from our state return.
2) Told me about a loophole where my wife could contribute to a traditional IRA instead of a ROTH even though we were over the traditional IRA income limits (its b/c she didn't have a 401k option at work)
3) Figured out ahead of time if we should go for the education credits or the business deduction for the school expenses. This allowed us to maximize other "business deductions" this year (as opposed to next year) to bump that category. The other option would have been decreasing my federal contributions so that the education credit would still apply (where it wouldn't if we didn't owe at tax time).
4) Planning to collapse charitable giving from multiple years into one calendar year so that we can maximize our deduction vs the standard deduction.

Go see an accountant after April 15th and the value proposition is WAY better than paying them to "do your taxes"

jawisco

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Re: Taxes, do you DIY?
« Reply #23 on: February 13, 2014, 06:47:51 PM »
What does your tax accountant actually do?    I lived overseas for years and my company paid to have my very complicated taxes done.  When I returned to the states the taxes remained complicated for a few years, but then got simpler each year.  More recently I got the distinct impression that my tax accountants were simply plugging my numbers into a canned program that really wasn't much different from TaxActonline,  which I have now been using for the past several years.

You should pay an accountant to help you with TAX PLANNING not tax filling!!!

If you only talk to your accountant when filing your taxes, you are missing out on the purpose of an accountant. I pay over $300 per year to meet with a local guy and if he was only filing my taxes it would be a total rip off.

They are worth it because they will help you come up with tax planning strategies that you implement in June. Go visit your accountant in June or September and say "what can we do to maximize for this year?" Most of them wont charge you for that meeting and that is where they will prove their worth.

Personal examples:
1) We got a free college course because it would push my wife over the "full time" threshold and then we could deduct all "living-at-home" expenses from our state return.
2) Told me about a loophole where my wife could contribute to a traditional IRA instead of a ROTH even though we were over the traditional IRA income limits (its b/c she didn't have a 401k option at work)
3) Figured out ahead of time if we should go for the education credits or the business deduction for the school expenses. This allowed us to maximize other "business deductions" this year (as opposed to next year) to bump that category. The other option would have been decreasing my federal contributions so that the education credit would still apply (where it wouldn't if we didn't owe at tax time).
4) Planning to collapse charitable giving from multiple years into one calendar year so that we can maximize our deduction vs the standard deduction.

Go see an accountant after April 15th and the value proposition is WAY better than paying them to "do your taxes"

I think you are right - the real problem is finding a good accountant.  Harder than you think - you obviously found one.

George_PA

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Re: Taxes, do you DIY?
« Reply #24 on: February 14, 2014, 10:29:04 AM »
greenmimama if you have the patience and are good with numbers do it yourself. 

I have it done my taxes on my own and learn so much about how taxation works as a result.  I don't even use an tax prep software.  I go directly to the IRS website and download all their documents.  When you do your own taxes, you have have read through the IRS publications and all the forms and schedules, it is a good education, to prepare you for the future; you learn what the thresholds are for taking certain deductions or credits; you learn how different investments are considered by the government

as a result, you will learn why certain things benefit you while others will not.  Thus, you can plan your own financial future more intelligently; also you are less likely to be swayed by false or inaccurate information from other external sources; you can see through the BS much easier and find out what truly matters and what does not;

Personally, I went through a period 2 years when I had a professional do my taxes (probably to just test the waters once in my life) and the sense I got from it is they wanted to keep you dumb.   

Professionals want taxes to be this mysterious world where you are basically completely dependent upon them for all knowledge relating to taxation and wealth in general.  Don't fall into the trap; One major theme of musachianism is empowerment through self education, learning of multiple skills, and become autonomous;

The people who really need professional advice are ones who are running large companies with employees or some really rare but complex taxes issues (i.e. if you had 5 rental properties or significant overseas investments).  When you get into these areas, professional advice really does pay off.  Other than these, if you don't have a big company and it is just personal taxes it is not a big deal, DIY. 

Good luck
« Last Edit: February 14, 2014, 10:31:32 AM by George_PA »

2527

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Re: Taxes, do you DIY?
« Reply #25 on: February 16, 2014, 08:27:26 AM »
TurboTax is free through Vanguard for Vanguard clients who have $1M invested with them.  There may be a discounted price for lower amounts invested.

If somebody's tax situation is fairly simple, and they have a good return from a previous year, I think it is pretty easy to use that as a guide and DIY.

Sparky

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Re: Taxes, do you DIY?
« Reply #26 on: February 17, 2014, 08:45:51 PM »
I do them myself and for a few other people as well. I like playing with numbers and such, so taxes don't scare me. However this year is my first year with a wide range of investments on the go, so a tiny bit nervous on that front.

Mori

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Re: Taxes, do you DIY?
« Reply #27 on: February 18, 2014, 08:54:14 AM »
Some states have deals to let you e-file your state income taxes for free if you qualify (my state has some with age requirements and some with AGI requirements). Might be worth looking into--my state website also lists which of the offered e-file companies will also do the federal taxes for free. That way you aren't out any money when you decide if you want to file that way. :)

MustachianAccountant

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Re: Taxes, do you DIY?
« Reply #28 on: February 18, 2014, 12:31:50 PM »
greenmimama if you have the patience and are good with numbers do it yourself. 

It's less about "good with numbers" and more about "understanding and following rules." The math involved is 6th grade level.

Professionals want taxes to be this mysterious world where you are basically completely dependent upon them for all knowledge relating to taxation and wealth in general.  Don't fall into the trap; One major theme of musachianism is empowerment through self education, learning of multiple skills, and become autonomous;

Get your tin foil hats out kids!
Actually, most tax preparers are happy to answer any questions you have, and aren't trying to hide some "esoteric tax knowledge" from the masses. I mean, it's all on the IRS website for crying out loud. It's just that most people simply don't care to know. They just want their taxes done, and not have to think about it.

Scandium

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Re: Taxes, do you DIY?
« Reply #29 on: February 19, 2014, 07:55:00 AM »
Get your tin foil hats out kids!
Actually, most tax preparers are happy to answer any questions you have, and aren't trying to hide some "esoteric tax knowledge" from the masses. I mean, it's all on the IRS website for crying out loud. It's just that most people simply don't care to know. They just want their taxes done, and not have to think about it.

Really?
http://www.theverge.com/2013/3/26/4150900/intuit-lobbies-against-returns-free-tax-filing-system

Quote
Intuit has spent over $3 million lobbying Washington in each of the past two years more than Apple, Amazon, or Yahoo including bills that sought to make it possible for US taxpayers to file pre-filled returns.

MustachianAccountant

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Re: Taxes, do you DIY?
« Reply #30 on: February 19, 2014, 09:18:20 AM »
Get your tin foil hats out kids!
Actually, most tax preparers are happy to answer any questions you have, and aren't trying to hide some "esoteric tax knowledge" from the masses. I mean, it's all on the IRS website for crying out loud. It's just that most people simply don't care to know. They just want their taxes done, and not have to think about it.

Really?
http://www.theverge.com/2013/3/26/4150900/intuit-lobbies-against-returns-free-tax-filing-system

Quote
Intuit has spent over $3 million lobbying Washington in each of the past two years more than Apple, Amazon, or Yahoo including bills that sought to make it possible for US taxpayers to file pre-filled returns.

"Making your taxes easy to do" and "Hiding information about how to do your taxes" are two different things. You're talking about the former, and I'm talking about the latter.
Are taxes needlessly complex? Yes. Is anyone hiding some special information on how to do your taxes? No.

Scandium

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Re: Taxes, do you DIY?
« Reply #31 on: February 19, 2014, 10:25:26 AM »
Get your tin foil hats out kids!
Actually, most tax preparers are happy to answer any questions you have, and aren't trying to hide some "esoteric tax knowledge" from the masses. I mean, it's all on the IRS website for crying out loud. It's just that most people simply don't care to know. They just want their taxes done, and not have to think about it.

Really?
http://www.theverge.com/2013/3/26/4150900/intuit-lobbies-against-returns-free-tax-filing-system

Quote
Intuit has spent over $3 million lobbying Washington in each of the past two years more than Apple, Amazon, or Yahoo including bills that sought to make it possible for US taxpayers to file pre-filled returns.

"Making your taxes easy to do" and "Hiding information about how to do your taxes" are two different things. You're talking about the former, and I'm talking about the latter.
Are taxes needlessly complex? Yes. Is anyone hiding some special information on how to do your taxes? No.

Sure, in that case I agree. I've called the IRS and they were very helpful. Although this was in January, not early April.. The information is definitely there if you look for it. I've always done my own taxes.
(Intuit are still scumbags though)

Fishingmn

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Re: Taxes, do you DIY?
« Reply #32 on: February 19, 2014, 12:20:21 PM »
I use an accountant who is a sole practitioner working from his home so his price is reasonable ($175).

He does our personal return, my business tax return and the returns for my 10 rental properties (including all of the depreciation calculations from year to year). 

If it was really simple I'd do them myself but it's a small price to pay for a more complicated return.

jordanread

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Re: Taxes, do you DIY?
« Reply #33 on: February 19, 2014, 12:32:39 PM »
With just recently getting positive net worth, I've done Turbo Tax Online for a few years now. We'll see how it goes now that I have a 401k and all of that.

hybrid

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Re: Taxes, do you DIY?
« Reply #34 on: February 19, 2014, 02:39:06 PM »
Each year my taxes get a little more complicated.  First came my side gig, then stocks, then the rental property, then my shell company in the Caymans.  OK, maybe not the last one, but the rest holds true.  I use TurboTax, and yes, it's a little pricey to file but not a bad deal for the hours and hours I would spend on my taxes otherwise, with absolutely zero confidence I was doing it the optimal way.

This is one of those areas where I could save some money by learning how to DIY without TurboTax, but it is far from low hanging fruit and I have other fruit to pick in the meantime.  No excuses, just my reality.

basd

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Re: Taxes, do you DIY?
« Reply #35 on: February 20, 2014, 01:24:44 AM »
I do it myself. It's ridiculously easy over here (Netherlands) to do it yourself as our version of the IRS fills in almost anything in our admittedly simple situation (two adults with payroll jobs, one child, house with mortgage, nothing special).

escolegrove

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Re: Taxes, do you DIY?
« Reply #36 on: February 25, 2014, 01:41:04 AM »
I did them myself until we started buying rental property. We found a wonderful accountant who helps us make sure that we have taken advantage of all the various tax code that is advantageous to us.

randymarsh

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Re: Taxes, do you DIY?
« Reply #37 on: February 25, 2014, 05:50:54 AM »
Always done them myself as a high school and college student, although with some schedule C income. I find doing them myself makes me more knowledgeable about the tax code. I also like being able to tell who has no idea how taxes work.

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Re: Taxes, do you DIY?
« Reply #38 on: February 26, 2014, 01:37:31 PM »
DIY, but I work at a local CPA firm. You're right in that tax accountants working on filing your returns are just taking the information you provide and plugging it into a software system. We get to run comparative reports to provide help to people in the subsequent year and between the CPA reviewing the source documents and return and anyone working on the return, you are paying for decades of combined tax knowledge going into the preparation and review. If all you have are W2s and some 1099s, I can't think of a reason you would want to pay someone else to assemble what should be a very easy tax return.

Once things get more complicated, an accountant's the way to go to get everything done right, done according to IRS code/clarification/ruling, and to have an intermediary between you and the IRS. I typically work on attestation services as opposed to taxes, but do help with a few simpler returns during tax season and have prepared some returns for lower billing than what the local tax shops charge without significant changes between the two years (i.e. they were grossly overcharged at the tax shop), so don't just run to those places thinking you're going to be charged less than if you went to a local CPA firm. No matter who you go to, even if you do your own taxes, keep your documents organized!

P.S. Just because I'm an accountant doesn't mean I am immune to money stupidity with my own finances, unfortunately ;)
« Last Edit: February 26, 2014, 01:39:12 PM by KeepCalmAndRepayDebt »

jrhampt

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Re: Taxes, do you DIY?
« Reply #39 on: February 26, 2014, 02:10:21 PM »
I kind of feel like I do all the work with gathering all the info anyways.

Exactly.  We had an accountant do ours for a couple of years when we had multi-state taxes to file, but now I just do it.  I was not impressed with the accountant, and I figured I'd do it myself rather than pay the $300.

MDM

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Re: Taxes, do you DIY?
« Reply #40 on: February 26, 2014, 07:32:46 PM »
Did them ourselves for years, using Excel to ensure we did the math correctly.

Switched to TurboTax in 2007, primarily to do grandma's return instead of her paying $240 to an accountant.  As long as we had the software, we used it for our own return.

We still keep an Excel file (new columns for new years) as a double check on TurboTax, mostly to ensure we haven't made an error in answering TurboTax's questions.

Aside from the time saved by having TT stay current on tax laws, it occasionally finds things I probably would not have.  Example that comes to mind is "not having pay taxes on a state tax refund if the Alternative Minimum Tax got us last year" (because the AMT doesn't allow state tax deductions in the first place.

gobius

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Re: Taxes, do you DIY?
« Reply #41 on: March 13, 2014, 09:43:28 AM »
I do my own; have been for about 5-6 years.  I used to use OLT.com and it is pretty good.  Costs $7.50 for federal and $7.50 each state.  My fiancee still uses it although hers is pretty simple (education expense deductions and a W-2).  I now use TaxACT online and started doing that a few years ago when I started investing.  OLT would probably work for me too if I wanted to go back. 

TaxACT costs maybe $20 total (federal + 1 state) but works for me.  I use it and have 1099's, a W-2, charity, and a mortgage.  I itemize and both programs will compare the standard vs itemizing your deductions.  Both programs make it really easy; once you get the forms you just plug the data in.  Mine used to be more of a pain because I had a managed account where the guy was buying/selling mutual funds all the time.  I recently put those assets in Vanguard and in future years it will be much simpler since I don't intend to buy/sell as frequently as he did.  Granted, I've never been audited but I think I would be fine.

I always get a laugh at the "Americans leave $1 billion in tax returns on the table" bit.  I guess I'm assuming they mean all Americans in aggregate, so how many taxpayers is that?  $1 billion doesn't sound like much ($10-20/taxpayer?) and I wonder how much people would save if they did their own.

Frankies Girl

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Re: Taxes, do you DIY?
« Reply #42 on: March 13, 2014, 10:09:53 AM »
I used to do our taxes (and my mother's) by hand on paper with a calculator. I switched to TurboTax about 3 years ago when things started getting more complicated, and now I'm really glad as we're going to have to include itemized deductions from medical and cap gains/losses and dividends and inheritance. I am procrastinating until the end of this month as I am not real excited to go through a pile of receipts and paper crap.

I usually used TT's free online version, but I think this year I have to step up and pay (maybe? I sort of hope not, but all in all a good run of "free" tax filing as I made it from 15-40). At least it turns out I can get a discount for TT for having accounts through Fidelity.

zolotiyeruki

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Re: Taxes, do you DIY?
« Reply #43 on: March 13, 2014, 10:27:25 AM »
I always do my own.  I'm geeky that way.  I like math.

I do, however, appreciate that my taxes have gotten simpler over the past few years--moving from one state to another complicates it.  So does redeeming shares in a mutual fund where all the original shares have been redeemed.  All that's left now are shares from dividends and capital gains distributions.

It also feels really good when I find out how far our family is in the infamous "47%".

Dwayne

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Re: Taxes, do you DIY?
« Reply #44 on: March 14, 2014, 08:22:56 AM »
I'm surprised no one has mentioned http://www.excel1040.com/

I've used it for a number of years now, I've checked it against manually calculated results and TurboTax, and it always comes out the same. If you enjoy doing your taxes yourself, this is great because it's essentially a self-calculating version of the IRS's forms. Put in your W-2 info in the W-2 tab, fill out your schedule A and B, it populates everything on the 1040.

James

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Re: Taxes, do you DIY?
« Reply #45 on: March 14, 2014, 08:27:10 AM »
I have been using Turbo Tax for at least 12 years, works well for me.

dcheesi

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Re: Taxes, do you DIY?
« Reply #46 on: March 14, 2014, 09:04:23 AM »
Used TaxAct again this year. One benefit is that it auto-imports information from last year, and shows you comparisons between your current return and the previous year.

The latter function probably saved me several times the purchase price this year, since I was missing a second 1098 with most of my mortgage interest on it (refi'd last year). I might have taken the trouble to compare returns if I was doing them manually, but then again I might not have, and a few other things changed so there's no guarantee I would have caught the discrepancy if it wasn't clearly laid out for me.

jpo

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Re: Taxes, do you DIY?
« Reply #47 on: March 14, 2014, 09:29:02 AM »
I plug everything into TurboTax and then do the free file forms myself, using TurboTax to cross reference totals.

labrat

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Re: Taxes, do you DIY?
« Reply #48 on: March 17, 2014, 06:56:04 PM »
I've used TurboTax (federal), and have done telefile and manual for my state returns.  No trouble with TT, but I'm curious about TaxACT - maybe I'll try it this year.

nottoolatetostart

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Re: Taxes, do you DIY?
« Reply #49 on: March 20, 2014, 11:18:02 AM »
We used to pay a CPA but he was a plug & done kind of guy. Inherited him from DH's parents and DH's single days. His rates went up last year to over $350 to file our basic taxes. I got serious on how to reduce our taxes and met with a tax planner. DH has a rental condo from his single days and I have just been following along with what the accountant does in TurboTax and it has been pretty simple to keep up with.

I think it is fairly easy for someone in this MMM community to figure out taxes and even do a dry-run in TT or TaxAct. It's the planning that is most difficult...

Forums like these have really helped me rethink our taxes. The biggest alone was maxing out our 401k. We were previously did the basic company match because between our employers and our contributions it was $20K per year (we put in $14K and our employers did another $10K or so). You all on this forum helped me realize that we could put away an extra $20K a year of our own money which put us into the 28% marginal tax bracket as a MFJ (let alone saving another 5% on our state taxes). Additionally, I know have the skills to know how to calculate rolling that money over once we FIRE so we can minimize taxes to stay in the 10% tax bracket going forward.

Another thing you fabulous people taught me about was recharacterization. DH did a non-deductible traditional IRA last year (pre-MMM) but we realized that we were paying an extra $1600 in 2013 taxes this year on that money because he had other rollover IRA's.
I had DH call up Schwab to recharacterize that conversion and then googled how to do it in TT before actually doing it officially with Schwab to make sure my numbers matched. It worked!

Finally, (a lot on retirement), DH gets a "pension" as a part of his bonus. Last year, we just took the cash (pre-MMM) and of course, have to pay a 10% penalty on that early withdrawal when filing our 2013 taxes. In February 2014, when given the option again, we realized we could....not only get more money (his company gives you a higher dollar amount if you could keep in a retirement vehicle instead of cashing it out).....and reduce taxes and avoid the early penalty and unlike last year, it did not add to our AGI....but we could just sign up to have it transferred to his Vanguard rollover IRA account (win/win/win/win). We probably $5,500 on that decision alone this year. Sure enough, this year, they sent us a check made out to Vanguard and will find out in another week if it worked.

We recently had a kick ass CPA look over our stuff and other than doing a HSA, he agreed that there was not much more we could do as 2 W-2 earners. 

I have a long way to go on tax planning , but am excited to see what else we will master.

Good luck!