The Money Mustache Community
Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: doneby35 on October 19, 2017, 03:27:10 PM
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Does anyone know of any good links explaining how one can understand and do their own taxes manually instead of relying on turbotax without actually understanding everything that is going on? thanks.
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That really depends on your situation. If almost all your income is reported on a W-2 it generally isn't that hard to understand the applicable tax regulations. I've never used software. As a paper carrier in high school, I did have to figure out some business/self employment taxes which was quite a pain the first time (my very first 1040!). Once my income came on a W-2, filing was dead simple. I expect to itemize deductions for the first time next tax season (2017 is my first full year as a homeowner).
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IRS.gov - you can still fill out paper forms and mail them in. Or submit the free fillable forms.
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ah yes of course, why didn't I think of that!
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Filling out a 1040 by hand is a good way to learn about taxes - the instructions walk you through just about every thing that could possibly be on your return in excruciating detail. Also a good way to play some what ifs as it relates to taxes - what if I max out my IRA? What if we have a kid next year? and so on.
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the best way to learn is to do it on paper. get the actual irs forms, fill them out with your particulars, see how each form and number relates to the others
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Using the forms and instructions on the IRS' website is how I do it, and we've had some complicated returns. Schedules A, C, D, E, and numerous forms. The instructions are beefy and it takes time to get through it but I've managed to do it all on my own so far. Never been audited so I assume I'm not screwing it up.
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My recommendation would be to fill out the paper, then get turbo tax (once - or use a friend/relative's copy on their machine) and compare the two. If they both match 😎Yea!!! If not you will know areas to look into.
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See also The Mustache Tax Guide (U.S. Version) (https://forum.mrmoneymustache.com/taxes/the-mustache-tax-guide-(u-s-version)/).
Creating your own spreadsheet to do the math in the forms can be helpful as well.