Tax Return Fee

[SecondCor521]

I think I may try to take my return and do a practice run..Is Turbo Tax the best way for me to go?

Can I use the free version if I have long and short term capital gains and foreign expense?
If not, which one should I buy?

How do you file it?

TurboTax and H&R Block are the two biggest in market share, or at least they were a while ago. TaxAct, FreeTaxUSA, and OLT are also players I've heard of and are probably second-tier market share players.

You might start with the IRS website for free online filing and see if you qualify for free filing through any of them: https://www.irs.gov/filing/free-file-do-your-federal-taxes-for-free

Many tax filing software packages will try to get you to upgrade and add on features - I think TT is one of the prominent ones in this regard. They also may start you out in a free mode (if you go from the IRS website) and then try to convert you to a paying customer. If you decline add-ons and are careful to comply with the instructions at the IRS link, you have a decent chance of filing for free I think.

I think most tax filing software will support e-file, which transmits your typed data electronically to the IRS, or paper file, where it prints out your return and then you can mail it in yourself.

ETA: And if you just want your return filed for less, if your foreign tax credit is low enough to use the simplified limitation election, then AARP Foundation Tax Aide can probably do your return for you for free, as @cathy63 mentioned above.

 

[SecretlyFI]

+1. At least give it a try and see if you match what you filed, then you'll have the confidence to do it on your own next year. Plus, you can learn things by doing it yourself.

+1. I've used Tax Act for years. Don't worry, you're not expected to know how to fill in the forms and line numbers. It's all question & answer based, where you answer questions to tell it which types of things are applicable to you and then it prompts you to enter the relevant amounts. When entering amounts from, let's say a brokerage 1099-DIV, it prompts you to enter what is in the specific "box #'s" from the statement you get from the broker. Or, as mentioned above, it supports importing from the brokerage.

You only pay when you want to print forms or e-file. But prior to that, you can see a running tally of your refund or what you owe, for both federal and state (very enlightening to learn the drivers, as you do the data entry). It also allows you to print a comparison to prior year, which I find helpful as a sanity check (this would only be relevant your 2nd year using the software, of course).

Speaking of year 2, doing taxes on software is even easier after the first year, because it will assume you have the same accounts at the same entities (banks, brokerages) so the prompts are even smarter then. You can always add new accounts, or drop any that you closed. It prompts you for all of this.

The fastest way to have confidence in doing this, in my opinion, is to fill it in after you've had your returns professionally done and you will see (hopefully!) that you get the same result.

 

[lawman]

Thanks again...I'm going to practice with my tax return I just had done and see if I can replicate it on Turbo Tax

 

[Koolau]

I consider spending money on tax preparation to be money well spent, though I can understand why some would not. This will be the last year I have to file two different state returns in addition to Fed return. We've been paying about $700. I think it will drop to around $500 when the other state disappears. YMMV

 

[target2019]

Thanks to all for the encouragement. I need to learn to do my own...

It would make a very interesting thread if you shared the experience.
Good luck.

 

[kannon]

I volunteer for AARP Foundation Tax Aide, so mine, my three kids, my Dad's, and a friend of mine are all e-filed both federal and state for free.

Also included in that price is about 40 hours of free tax training and access to tax software in December.

This year I'll also prepare about forty other strangers' returns as well and get reimbursed about $10.53 per week for mileage.

Me too. TaxAide volunteer. Get to do relatives and immediate family. Free. Free. Free. Check out your local senior centers.

 

[VanWinkle]

There is no charge to have your return done by an AARP Tax-Aide or VITA/TCE volunteer. It sounds like that might be a better option for you. You can find nearby sites here: https://www.irs.gov/individuals/free-tax-return-preparation-for-qualifying-taxpayers

Those of us who volunteer are not CPAs, but we do some training on tax prep, and we do hundreds of returns that are very similar to yours.

+1 This for most returns. There are some out of scope returns we can't complete(due to rules vs lack of knowledge). I have been a Tax Aide for 6
years and have heard about the 250 to 300$ charges for simple returns at tax preparers.

 

[Philliefan33]

For me, of the most satisfying aspects of being an AARP TaxAide volunteer is when a little old lady with very low income is almost moved to tears when she finds out she does not have to pay for our service. Not having to spend $200 for tax prep is a big deal for some.

 

[VanWinkle]

For me, of the most satisfying aspects of being an AARP TaxAide volunteer is when a little old lady with very low income is almost moved to tears when she finds out she does not have to pay for our service. Not having to spend $200 for tax prep is a big deal for some.

+1 Great to feel like you've saved someone who can barely afford the necessities a couple hundred dollars.

 

[lawman]

Okay I have started my return on Turbo Tax..I'm about halfway through and so far so good..I don't think I would ever be comfortable linking my Brokerage and bank information so I am entering it myself..Once I complete the process will I be able to see it and compare with my return that I am trying to replicate without paying for the program?

 

[cathy63]

Okay I have started my return on Turbo Tax..I'm about halfway through and so far so good..I don't think I would ever be comfortable linking my Brokerage and bank information so I am entering it myself..Once I complete the process will I be able to see it and compare with my return that I am trying to replicate without paying for the program?

No, you can't see your forms without paying for the program, but it will give you enough of the numbers that you should be able to verify you've come out with the same return.

 

[SecondCor521]

Okay I have started my return on Turbo Tax..I'm about halfway through and so far so good..I don't think I would ever be comfortable linking my Brokerage and bank information so I am entering it myself..Once I complete the process will I be able to see it and compare with my return that I am trying to replicate without paying for the program?

What @cathy63 said.

You might be able to see the tax return in some of the other tax programs like TaxAct. It would mean starting over on the data entry, of course.

 

[lawman]

No, you can't see your forms without paying for the program, but it will give you enough of the numbers that you should be able to verify you've come out with the same return.

thx

 

[gamboolman]

We have used a CPA for the last 20 year as I was living / working oversea's as a Married Accompanied Expat for megaoil corp until retiring 1-Feb-21.

We just finished 2021 Income Tax exercise and will be getting our CPA's invoice soon. I expect it to be in the ~$750 range - as that is about what it has run for many years.

It will be interesting for next year (2022) Income Tax exercise as it will be first one with no megaoil income.
I expect our CPA will not have to spend as much time for preparation and the cost ought to be less.

I have not really thought on it, but we might get to the point that we would be confident enough to do our own Income Taxes in a few years..... but maybe not.... ha !

 

[lawman]

Okay...I did it! I just completed my ghost return on TurboTax and even though it would not show me the tax it did show me the amount of my overpayment and it was exactly he same amount as is shown on my tax return just done by my c.p.a. ...Next year I will do my own...Thanks everyone...

 

[RetiredAndLovingIt]

Congratulations, we all knew you could it.......

 

[RetiredAndLovingIt]

I buy the TT Deluxe program and install on my PC. It comes with 1 free State download and 5 Free Federal e-files so you can share it with other family members. Amazon sells it for $40 with a $10 Amazon Giftcard usually the day after Christmas, but this year they made us wait a few extra days for that deal.
Also the program has a great "What If" feature that you can use to estimate your next years taxes at different income levels. I use it for Roth Conversion planning.
OH, and you can also see your all forms if you want to check something with the CD or download purchase.

 

[iloveyoga]

Okay...I did it! I just completed my ghost return on TurboTax and even though it would not show me the tax it did show me the amount of my overpayment and it was exactly he same amount as is shown on my tax return just done by my c.p.a. ...Next year I will do my own...Thanks everyone...

Great job!!

 

[SecretlyFI]

Okay...I did it! I just completed my ghost return on TurboTax and even though it would not show me the tax it did show me the amount of my overpayment and it was exactly he same amount as is shown on my tax return just done by my c.p.a. ...Next year I will do my own...Thanks everyone...

Awesome job!

 

[londo]

You might be able to see the tax return in some of the other tax programs like TaxAct. It would mean starting over on the data entry, of course.

Does anyone know for sure which other free tax software allows you to see the forms without paying?

I've done my taxes directly on freefilefillableforms for years. This thread has made me interested in signing up to be a Tax Aide volunteer next year. I'd like to try some tax software to both confirm I'm not missing anything in my own return and also to check out the software, and be able to compare its output forms with mine.

I tried OLT and it allows me to see the forms (yay!) but I can't figure out how to tell it that a distribution from a 529 plan account was used for eligible college expenses so should be tax free. It keeps adding the earnings portion to my taxable income. If the same kind of thing happened with TurboTax and I couldn't see the forms I probably wouldn't figure out what was happening.

So I'm looking for any other free software that lets me see completed forms, even if it wants payment to efile them. Thanks.

 

[cathy63]

Does anyone know for sure which other free tax software allows you to see the forms without paying?

I've done my taxes directly on freefilefillableforms for years. This thread has made me interested in signing up to be a Tax Aide volunteer next year. I'd like to try some tax software to both confirm I'm not missing anything in my own return and also to check out the software, and be able to compare its output forms with mine.

I tried OLT and it allows me to see the forms (yay!) but I can't figure out how to tell it that a distribution from a 529 plan account was used for eligible college expenses so should be tax free. It keeps adding the earnings portion to my taxable income. If the same kind of thing happened with TurboTax and I couldn't see the forms I probably wouldn't figure out what was happening.

So I'm looking for any other free software that lets me see completed forms, even if it wants payment to efile them. Thanks.

You don't need to enter a 1099-Q on your tax return unless some of it is taxable, so that might be why OLT would be adding the earnings to your income. If some of your earnings are taxable, you would probably have to calculate that amount yourself and report it on Schedule 1 and form 5329. I would not expect OLT to handle this case, but TTax probably does have a more sophisticated calculation engine that can figure that out.

For Tax-Aide, a 1099-Q with a taxable distribution is out of scope and we can't do that return.

 

[Deej]

I was paying a CPA $400 to do our joint taxes which included filing my small business. When Covid started, I decided to skip him and do it myself using our prior year tax report as a guide. It was my first time ever doing taxes and I actual enjoyed it - really, and everything was explained. I'll continue to do them myself. I like learning and saving money too.

 

[londo]

Thank you Cathy. It's good to know that I'm reaching outside Tax-Aide limits with some variations of 1099-Q and the like. I've found this gets tricky and I wouldn't want to mess up someone else's return if I'm supposed to be helping them out.

For the record, I only entered the 1099-Q info because I believe I'm due education credits and inputs to form 8863 require data from the 1099-Q. OLT supports both 1099-Q and 8863, but maybe I'm asking a bit much of free software. The good news is that outside the education parts, OLT agreed with the rest of my hand-done calculations.

 

[SecondCor521]

Thank you Cathy. It's good to know that I'm reaching outside Tax-Aide limits with some variations of 1099-Q and the like. I've found this gets tricky and I wouldn't want to mess up someone else's return if I'm supposed to be helping them out.

For the record, I only entered the 1099-Q info because I believe I'm due education credits and inputs to form 8863 require data from the 1099-Q. OLT supports both 1099-Q and 8863, but maybe I'm asking a bit much of free software. The good news is that outside the education parts, OLT agreed with the rest of my hand-done calculations.

The main dollar input to the 8863 is on line 27 where you put how much AQEE you had, which might be reflected in amounts on a 1098-T but probably not the 1099-Q.

You're not allowed to use the same qualified expenses for an educational credit like AOTC and to make a distribution from an ESA or 529 (which is what show up on 1099-Qs) tax free. See Pub 970 page 14 column 2 bullet #3 at https://www.irs.gov/pub/irs-pdf/p970.pdf.

 

[londo]

Yeah I'm deep into Pub 970 - the example on page 53 which covers the coordination of QTP distributions with credits seems to apply exactly to my situation. And that requires 1099-Q input.