I used to do on paper by hand, but later used TurboTax, or TaxAct. It seemed like no matter what I did with those I would get a note from the IRS a year or so later saying "here's some extra money we thought you'd like" or "we need more of your money." I guess the software can only be as smart as the person using it.
One year I got tired of the software and did it on my own until I got to AMT and it said I had to my taxes all over again, but this time the instruction booklet was written entirely in Martian, so I gave up and did TurboTax. These last few years I figured since I seem to get it a little wrong most of the time no matter how I do it, I might as well do it the old fashioned way.
My question is, what are the reasons to use a software package?
One is if you have to do AMT, given the Martian situation. Worth the $40 right there. But I haven't had to do that since that one year. Other than that, what is there to watch out for, for someone with a real simple situation? I have W2, then 1099-DIV. If I sell stocks then I have capital gains. No interesting investments so no 1099-INT. That's about it for me.
The other thing I can think of is deductions, but back when I used the software I would dutifully enter car payments, mortgage interest, contributions, etc. and it would come up with something about the same as the standard deduction... which seemed sort of weird, isn't the mortgage interest deduction supposed to be some giant benefit of being a homeowner? Anyway... no significant medical expenses, no commuting (2020 hah), no anything really.
Another thing I learned is remember to report your cost basis, if you have capital gains. But once again, software can't make up for the user being a klutz.