For most of the time that I’ve had to file taxes, I’ve used some of the home tax filing programs. My taxes were never really that complicated, so I just used turbo tax and collected the money or paid what I owed and moved on. This worked all well and good, but the last 2 years (2010 and 2011) my taxes were different.
In 2010, I owed quite a bit of cash during tax season. This was because I didnt have a full time job for a full year before this point, and I didnt withhold enough during the year. I gulped, paid my taxes and moved on. I didnt bother changing my withholding because a new job was in the works at the time, and I figured once that deal closed I’d just raise my withholding with my new employer. All of that worked well, but I still had my 401k from my old job that I needed to roll over, as well as some income tax from the state I used to work in before I switched jobs. All of this led to a complicated tax situation in 2012.
Long story short, the free versions didn’t really cut it anymore. After I filed my federal taxes I had a sinking feeling that I didnt do them write, so I took them to someone in town and had her look them over. She confirmed my suspicions, and after a small fee, I paid another few hundred bucks to the feds and was on my way. The real problem last year was my state taxes, as I ended up having them think I owe them a ton of money because of how their filing system worked. After that, I went to see an accountant to get my money back, and thankfully she got my money back. I still owed a bit of money, but it was better than what I was originally paying. (It also seems that my sister is having a similar problem with the same state this year).
So this year, after buying a house, getting married, incorporating my business and making lots of business purchases, I figured the situation would be a bit complicated this year so I decided to go back to the same accountant. I didnt find her fee to be unreasonable last year, so I’m willing to give it another try. Not long after I had made my decision, I was talking to a friend who had just finished his taxes for the year. His situation is not nearly as complicated as mine, but wasnt straight forward either, and he said that turbo tax worked just fine for him. This gave me an idea. Since turbo tax is free until you’re ready to file, I can use turbo tax up until the filing point and see what the final results is, then compare that with the final result that I get from the accountant. The winner will be declared based not just on who/what get me more cash back, but on who/what will get me the most back for the cost incurred as well as the time that I spent on it. Honestly, I really have no idea what is going to come out on top, so lets see!
If you’re interested in giving turbo tax a try this year, you can file a federal return for free online if you’ve got a simple return (which is what I did for a long time), or for a bit of money if your situation is a bit more complicated. Check it out below:
Readers: Have you ever used an accountant, or do you typically use a program or file them longhand on paper?