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Old 12-30-2014, 09:39 PM   #21
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I have always done my own but don't use tax software, just download the forms, complete, print and mail. I use an excel spreadsheet to estimate my fed/state taxes throughout the year, and it has always been very close to the actual.
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Old 12-30-2014, 09:44 PM   #22
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Currently my taxes are done by a CPA, but that is because my company pays for it, once we retire then I plan on using TurboTax and do them myself as the tax situation should be very simple (although I am dreading the actual first year of filing when we retire as our tax situation will change mid-year).
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Old 12-30-2014, 09:48 PM   #23
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My brother, the CPA, told me years ago never to waste my money on accountants for doing my taxes. That was back in the days before TurboTax when you got your information from a copy of IRS Publication 17 you picked up at the post office.

Now, if I owned a business or something, I might think otherwise. But these days I use HR Block at Home. The only problem I had with the IRS was last year when they thought that having a retirement plan at work meant you couldn't deduct any of a Traditional IRA contribution. Took me months to educate them on their own pub 529 worksheet (that deduction is phased out based on one's income).
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Old 12-30-2014, 10:06 PM   #24
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And whatever you do, do NOT use the same tax software as TrvlBug's former CPA!

Did they at least prepare the amended return to recover the $3k for you?
Ha ha...yes, I'm tempted to ask what software he uses so I can avoid it!

I caught the error during my review of the package prior to finalization and submission to the IRS. In past years, I always did a cursory review, typos, transpositions, and the like, before finalizing and sending off.

I was puzzled as to why he or I didn't catch it by review of the year to year comparison worksheet he always provides with the package. It was the first full year of my retirement as well as the liquidation of one of the K-1 partnerships, so some very different income streams from past years. I can understand why I didn't catch it with the year to year overview, but feel he should have. I have a feeling there is no review at his end.
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Old 12-30-2014, 10:32 PM   #25
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No review at his end would be unusual in my experience. Usually a more junior person prepares the return and then it is reviewed by more experienced people and also at least a cursory review by the partner who signs it.

Many moons ago I was that more junior person preparing the return but decided that I preferred corporate accounting to taxes.
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Old 12-30-2014, 10:49 PM   #26
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I have done my own taxes each year for the last 29 years since I began working in 1985. When I bought my first PC in 1995, I created a spreadsheet to help me do the math. I worked in the actuarial field for 23 years so I am good at math and spreadsheets. No TurboTax or H&R Block or a CPA for me, ever. I have only begun dabbling with the fillable pdf forms in the last year or so; with my crappy handwriting it will save me some trouble.


The things which made my returns tougher over the years were (1) when I began investing and had to complete Schedule D in the early 1990s, (2) When Congress changed the determination of investment income in 1997, (3) when I began working in New Jersey in 2001 and had to file a NJ non-resident return along with a NY Resident Credit form, and (4) in 2008 when I cashed out my company stock and got hit with the AMT along with lots of other little worksheets I used to ignore. Since 2009 (my first full year of ER) my taxes have gotten much easier to do.


I have made a few mistakes over the years on my returns, nothing big, surely not enough to get me to change to another method. I prepare returns for my ladyfriend and my best (male) friend, too and have done so for 10+ years.
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Old 12-30-2014, 10:53 PM   #27
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Since the beginning of my professional career 18 years ago, I have relied on the services of a solo practice CPA to prepare tax returns for myself and DH. I was not familiar with tax laws and was self-employed, and the AMT section looked complicated to me. I went from self-employed to receiving W-2s, but that AMT section still looks complicated. I decided my CPA's expertise was well-worth the expense and peace of mind.

And, after 18 years, it's almost like visiting an old friend each year.
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Old 12-30-2014, 10:58 PM   #28
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I use the accounting firm Dewey, Cheatem, and Howe...

My taxes are pretty simple, so self-prepared via TT Online, filed electronically, and direct deposited.


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Old 12-30-2014, 11:13 PM   #29
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Ah, I forgot all about JK Lasser book until it was mentioned. And I now recall doing my taxes in pencil, then when I was sure, I went over the numbers in ink to finalize the return.

Without tax software, every time I forgot something and needed to add it, I had to erase and update all the numbers downstream. I hated it. I gladly paid for tax software ever since it was available. I used TurboTax, then TaxCut, and now TaxACT.
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Old 12-31-2014, 01:51 AM   #30
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Turbo Tax for about 6 years now! Even if you hire an accountant I recommend at least experimenting with Turbo Tax. You can enter hypothetical gains, losses, property tax deductions and see real time how it affects your taxes in a dollar amount. Do your own taxes in Turbo Tax and see if it matches up with Mr. Accountant then next year maybe you'll use Turbo Tax instead.

Turbo tax also allows you to ask tax questions for free. A CPA will answer for you!

Also if you think you are at high risk for an audit then you can pay for insurance with TurboTax.
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Old 12-31-2014, 05:36 AM   #31
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I have always done my own taxes since about 1975. After I retired I did the H&R Block tax jig for fun and to keep up with the tax code. The last two years have worked for VITA doing taxes for low income and elderly. Unless you have something really weird going on you should be able to do your own using one of many fine tax software programs.
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Old 12-31-2014, 05:47 AM   #32
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I have always done my own taxes, starting with forms until spreadsheet software became available, then spreadsheets, then bouncing among various tax software packages based on cost. I have settled on TaxAct for the last 5 years. I like math and have never had very complicated returns. Capital gains, non-cash charitable donations, AMT, and multiple states one year are the "worst" I have had to deal with.

We were audited once for charitable contributions, but that was just a matter of sending in copies of the receipts and that was quickly resolved.

My observation is that, while tax law should be a lot less complicated (wishful thinking), what gets a lot of folks is the discipline required to track tax information during the year and then organize it. With the software I enter in information as I receive it and then file the hardcopy appropriately, which makes it much less painful and gets my taxes completed by early February in most cases. When I actually file them depends on whether I am due a refund or have to make a payment.
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Old 12-31-2014, 06:52 AM   #33
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Turbo Tax for about 6 years now! Even if you hire an accountant I recommend at least experimenting with Turbo Tax. You can enter hypothetical gains, losses, property tax deductions and see real time how it affects your taxes in a dollar amount. Do your own taxes in Turbo Tax and see if it matches up with Mr. Accountant then next year maybe you'll use Turbo Tax instead.

Turbo tax also allows you to ask tax questions for free. A CPA will answer for you!

Also if you think you are at high risk for an audit then you can pay for insurance with TurboTax.
I love this ability since I've been retired to really try out different scenarios during the year to determine the tax impact of selling funds, doing ROTH conversions etc. After downloading this year's tax software I ran a test with more accurate year end estimates based on figures ytd and found that I could still do a little more to fill up a tax bracket.
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Old 12-31-2014, 07:31 AM   #34
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I have tremendous gratitude for all of the great advice and insight posted here, and I figured there may be no better place to post my question... who does your taxes?
I've been doing my own taxes and a few others for about ten years. I had a training class in the beginning, and lot of help from a family member who did taxes for a living.

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Personally, I have hired an accountant for the past 20 years but only because my parents hired an accountant ever since I could remember. I know, it's not the most reasonable thing to do since all of our other financial endeavors are exclusively and confidently handled by me and DW. Our financial picture is not too complicated (I have w-2 income, no mortage, one rental income property, one Vanguard brokerage account, and DW does infrequent freelance 1099-based work) but I wonder if hiring a CPA to do our taxes is really necessary. My main concern has been to not miss any entries in our filings to potentially benefit us... or even worse, to make entries and deductions that may harm us in the long run (even though I am fairly conservative as I prefer a good night's sleep with low audit potential over taking aggressive chances with our tax filings). The secondary benefit was that my CPA was a great source of financial counseling that made the annual fees and meeting well worth it. However, he recently retired and my latest experience with a CPA was lackluster at best.
Your tax situation is complicated, but only the preparer can say for sure.

It sounds like you do the proper accounting already, and just need the assurance that you're putting the numbers into the proper boxes. Each software package has its own approach to this. I get really frustrated with TT, but am forcing myself to use it for two returns each year.

You can't replace the advisor with software. The user community is probably your best bet. Search the Q&A now to see the quality of help you'll get. You may have an obscure question, but just about every question has already been asked and answered. There are always a few questions asked here too, each year.

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So.... is there any rationale to seek the services of a CPA or is the Quicken and TurboTax route sufficient for most filings of relatively simple scenarios? Are there any good resources that you use for doing your own taxes?
The answer for you depends on how much time you want to spend on this. I watched a preparer do returns similar to yours, and it always took him less than an hour. I was in awe. My guess is that it would take me 8-40x's that amount of time, and I would have to ask questions.

Here is a WAG about the time it will take an average newb to do the returns you mentioned -- at least 40 hours. Of course you're above average, and it won't take so long.


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I may be missing some information here that would help in answering my question so please feel free to ask, and I'll provide it. Thanks in advance!!
On the positive side you gain a lot of knowledge by doing your own taxes. I'm thinking you may net $500-1000 or so by doing it yourself. If you were paying more than that it becomes very worthwhile.

There are probably webinars and classes starting now, so you may want to look around.
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Old 12-31-2014, 07:51 AM   #35
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It all depends.

I use a CPA, my CPA goes to tax classes at least 8 weeks a year. My taxes are complicated but I would always use a CPA. Here's why: 1st, I want assurance that my taxes are correct, next, depreciation rules often change, as an example 2014 depreciation changed last week. And, if there is a mistake, I'm covered. Next reason is cost and time. Software costs money, my work would be a lot of time.....much more time than it takes my CPA. Then we look ahead to the next year and talk about what I could or should change to save on taxes next year. then, finally, we work on my will and estate plan each year.....making sure I'm doing the right thing for DW and kids based on net worth and income.

Now, I started by saying it all depends. You have to look at the cost and trust of a CPA. I never would use one of the "quicky" tax preparers that hang out at WallMart.....I'd get a good one, determine cost and trust than make your decision. Many on this blog do their own taxes and do them well.....others absolutely need and use a CPA. My advice? If in doubt, hire a good one. Good luck
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Old 12-31-2014, 07:59 AM   #36
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In a complicated tax situation like you have, I wonder how you can be sure that the tax preparer or even a CPA is well-versed in tax laws in both State A and State B?

I am curious because such an expert would be expensive, and what he charges would be an incentive for me to learn the intricacies myself, particularly if I have to deal with it every year.
We paid him about $300 to look at the 2 returns (2012 Fed and 2103 State). What impressed me was the he zeroed in on key issues almost immediately. I asked what he'd charge to do returns of similar complexity and he said about $300.

I suspect he uses software to sort out State A/State B issues, too. Hopefully that won't be an issue after this year since I no longer have wages in State A. (It's possible that when we downsize we might move to State A but I doubt it.)

Having said that- I agree it might make sense to give it another try on my own. Following the directions (send State A return with the State B return), spending a few bucks for a second state return and double-checking brokerage downloads would be a good start.


I mentioned that I'd always done my taxes on my own but there were a couple of years when I dealt with the tax accountant my first husband had used for years. I agree that gathering information was most of the work. The second year, I gave him all the info early on and mentioned that we'd married the previous year. The bozo called 2 days before the return was due and needed a pretty big check; the way the state laws worked, the income of one of us was shoved completely into the highest marginal bracket. Oh, yeah, he needed a check for quarterly estimated taxes, too. That was the end of the CPA. I really felt he should have seen that coming instead of surprising us with it at the last minute. Money was tight at the time.
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Old 12-31-2014, 08:01 AM   #37
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I've been a TurboTax user for many years. Unless I had a small business or something very unusual, I see no need for a CPA.
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Old 12-31-2014, 08:03 AM   #38
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I used to do them myself but I now hire it out.

Wife has regular W2 but I'm Realtor with business return and we have 11 rental properties with different depreciation schedules. I pay $190/year which seems really reasonable. If it was a lot more I'd probably do it myself. If I subtract out the cost of a TurboTax version that could handle all of that it's really pretty cheap.

I do the returns for my 2 kids in their 20's with free online tools.

edit - Just looked it up and the version of TurboTax I'd need costs $110 inc. the State return. Makes my $190 to the accountant even more of a no brainer. Just a sole proprietor working from his house so I know he's a lot less than going to a CPA firm.
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Old 12-31-2014, 08:07 AM   #39
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.....No TurboTax or H&R Block or a CPA for me, ever. ...
Neanderthal.
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Old 12-31-2014, 08:12 AM   #40
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