Best US Tax Prep - Buy Software or Hire a Preparer?

[Siestatime]

For U.S. taxpayers, it's that time of year again - planning to pay Uncle Sam.

I've used TurboTax Deluxe for several years and am content with its straightforwardness and simplicity. I think it fairly identifies all my potential deductions so I don't feel I'm getting screwed. I don't have the most complicated portfolio, but am currently employed and have typical deductions.

Just wondering if I'm a chump. Do you guys use retail tax prep software or do you hire tax preparers to get you the biggest refund possible?

 

[Original Wally]

As a retired CPA, MOST folks can EASILY do their own with either the Turbo or H&R Block program. They walk you thru a nice Interview section and do a good job of boiling fairly complex issues down to the essentials. The MOST IMPORTANT issue is to recognize whan there ARE issues. If nothing substantial has changed in your life from last year, you are pretty safe using a self prep program - using last year's return for a kind of check list.

If you have a major change "this year" it may be worth it to get professional help.

Free advice and worth EVERY PENNY!!!!

 

[aja8888]

I have been using Turbo Tax since it was developed. No issues. I also ran a Sub S Corporation for 13 years and we filed federal 1120S taxes with it. Now that I am working part time, all I use is TT Basic. No state tax filing in Texas.

 

[freebird5825]

Turbo Tax Premier all the way.
Mr B and I split the cost, so I get an automatic 50% discount.

I shop around for the best price online and lowest (or zero) shipping. I like to have the physical CD in hand versus downloading it.

 

[JOHNNIE36]

I use an AARP sponsored tax preparation service. All volunteers except the overseers who are professionals. Free service and for the last two years have done an excellent job. Every tax prep is reviewed by the professionals. Look around on Google. I know there are limits as to how far they will go and want to stay with the uncomplicated returns. Just ask.

 

[Gabieta]

I use an AARP sponsored tax preparation service. All volunteers except the overseers who are professionals. Free service and for the last two years have done an excellent job. Every tax prep is reviewed by the professionals. Look around on Google. I know there are limits as to how far they will go and want to stay with the uncomplicated returns. Just ask.

Thanks for the great recommendation! I am a volunteer tax preparer, and work with a great team of volunteers. We tend to ignore the limits, as our team has several retired CPAs (even ignore the income limits as long as we can handle the workload!)

 

[brewer12345]

I use TT Deluxe. The problem with using a professional is that there are always gray areas and decisions to be made on your tax posture. If you DIY, you make the decisions and know exactly what has been done. If you use a pro, often they make the decisions and you may not even know there was a decision to be made. I play it very conservative, so I like DIYing and knowing that I made the straight arrow choice every time.

 

[easysurfer]

Turbo Tax Deluxe works fine for me!

 

[samclem]

I use TT and like it a lot, but have used the H&R Block program in the past and found it good, too.

Doing my taxes myself gives me a much better understanding of the opportunities to save on taxes in the future (and which talked-about opportunities aren't worth it to me) than I'd ever get if I left everything to a paid preparer. I guarantee that there are hundreds of thousands of middle income Americans who have their taxes done professionally and believe their mortgage is saving them lots of money, when they are really saving very little or nothing compared to just taking the standard deduction.

I do know people who, every few years, do their taxes themselves and then pay someone to do them. They look at the differences and pay the preparer to explain them. Then they accept the advice they think is appropriate and use it in the following years. This might be worth doing if you have a complicated situation.

 

[Walt34]

TT works fine for us, but our returns are not all that complicated. Before TT we did it ourselves anyway. TT just does the math and eliminates the transposition errors that I am prone to so I don't have to do everything three times.

 

[Siestatime]

Thank you all. That's what I thought. I have an accountant acquaintenance who calls me a chump because I settle for TurboTax's terms. She comes from a long line of accountants and lawyers which leads me to believe Brewer12345's comments that when professional preparers identify additional deductions they might come from 'gray areas' in the code that are a little dicey. I'd rather sleep well at night, thank you.

 

[easysurfer]

I used to hire a prep person for my taxes. But there were a couple of things that got me irritated so I went with software instead. First, my prep person each year seemed to raise the price up, even though I was probably one of the most organized clients, having everything in nice, neat files to hand off. Second, upon proofreading, I'd find occasional errors. For example, for my property taxes, one year instead of adding a first half and second half statement, the number for the first half (or vice versa) was added twice.

So, I decided, enough of that, and just used TT and did the taxes myself. At least I know it's done thoroughly, plus saves $$ too.

 

[Brat]

I have used TT for years. A friend of ours was lamenting how much she paid to have her simple return prepared last year so I said I would be happy to share TT with her. I suggested she test it with last year's return, professionally prepared, so that she could see the hassle involved. Today I walked her through the old 1099s etc and discovered that the preparer hadn't included property taxes paid on a home she sold. Reality is that she didn't offer it but she did produce information on the sale of the house... the preparer should have asked. That detail would have saved her $200 in Fed tax alone! I told her she could decide to file an amended return in the next year, after she found the escrow paper work.

She whined about answering all the TT questions but I told her she could always pay a preparer.. which ended the moaning.

She is a widow and discovered that the preparer who prepared her return before her husband passed was incompetent, last year's preparer needed to amend a couple of his returns. She feels that by using TT at least she knows the what and why of her return.

Bottom line: TT and their ilk are not the end all of tax preparation but for those with comparatively simple returns they are a great value.

 

[Original Wally]

true, going thru the interview IS time consuming. BUT... do it in stages. DON'T feel that you MUST do it in one sitting. If you take your time, it is a very managable task.

 

[MichaelB]

Just wondering if I'm a chump. Do you guys use retail tax prep software or do you hire tax preparers to get you the biggest refund possible?

No, you're not a chump. Just the opposite, in fact. As long as you are comfortable using it, TT is most likely the best option you have.

 

[GrayHare]

To optimize tax issues for your portfolio, your tax preparer and financial advisor need to work together closely. That rarely happens, unless both are the same person, and that person is you employing a copy of something like TurboTax.

 

[Coolius]

Are there any significant differences between Turbo Tax and H&R Block?

I have used H&R Block exclusively for many years, but was wondering if I should change to TT as most folks I know seem to use that and are happy for the most part.

I have a simple return, no salary ( FIRED in 2011 ), no rentals, no self employment, no exotic investments. The biggest section is my Sch D, as I do a fair bit of trading stocks.

However.....this year 2013 I was thinking of investing in MLPs which produce a monster document called a K-1. Which software package does a better job handling K-1s?

 

[obgyn65]

I also go with HR Block and take their audit guarantee every year for extra peace of mind. I may use the software route when time permits, when i have more time to understand all the tax forms, hopefully when I FIRE.

Are there any significant differences between Turbo Tax and H&R Block?

I have used H&R Block exclusively for many years, but was wondering if I should change to TT as most folks I know seem to use that and are happy for the most part.

I have a simple return, no salary ( FIRED in 2011 ), no rentals, no self employment, no exotic investments. The biggest section is my Sch D, as I do a fair bit of trading stocks.

However.....this year 2013 I was thinking of investing in MLPs which produce a monster document called a K-1. Which software package does a better job handling K-1s?

 

[RunningBum]

I also use TT and agree with many of the points above. Doing it myself means I better understand things like Roth conversion, and the real impact of going over the top of the 15% bracket. I can easily run "what if?" scenarios to learn things and confirm or correct my understanding. Of course I could use TT for that and still turn over actual tax prep to a pro, but I wonder if I'd really do as well.

 

[Sarah in SC]

Am I the only Tax Act user? I first learned about it here, maybe in 2008 or so, and have used it ever since. It is free, though if you want to do the e-filing you have to pay something for the state version. IIRC, it is much cheaper than TT.
We have super easy taxes: no debt, no small business income, and no little deductions running around the house.

 

[donheff]

We used a preparer for many years when DW was full time with multi-state income, self employment tax, and a lot of variability. When she semi-retired I followed the accountant the first year using Turbo Tax Deluxe and then switched over to doing it myself. Although our income is very predictable now, DW still gets a stipend from the firm that entails multiple states and self employment tax. In retrospect, I could have done it myself all along.

 

[gerntz]

The main thing my tax advisor/preparer does is inform me of the tax consequences of having/taking different kinds of incomes. That has saved me way more than his costs. I don't get that filling out the forms however myself.

 

[samclem]

Am I the only Tax Act user?

No, there are others here. I tried it several years ago and it was okay, but there were some technical issues (I had to shut down my computer and change some things to get it to run, etc). I have Schedule C income and a solo 401K, I didn't know if it would handle those things well, and I just didn't want to go to the trouble to learn the stuff that's different from TT's approach. A lot of folks like Tax Act, but I have a low threshold for both computer aggravation and tax aggravation, so the $$ for something I already know and which runs without (even minor) glitches is worth it.

 

[WhoDaresWins]

I use a wonderful accountant who takes the box of receipts and statements I dump off at his place every year and magically renders by return mail prepared statements for my state and federal taxes. He is one professional that I think charges me way too little for his services, probably not much more than purchasing a tax software program.

I know some folks enjoy preparing their own taxes but I am not one of them.

 

[HighRoller]

I've been using Turbo Tax Deluxe for years now... In the past I would buy it at Wal-Mart so I'd have the physical CD but in the last few years I've just downloaded it directly from the Turbo Tax web site. Never had any problems either way and it's been very easy to use, save, edit, print, etc. I've never used the efile option but I may try it this year.