Is Tax Software Really Worth It?
My 2014 Experience With TurboTax.
By Christopher Munchhof
Real Life TurboTax Reviews
since using turbotax i have been IRS audited each year. the problem always ends up with no fine no added amount...it is ALL about turbotax seeming not to do a good job on pensions and annuities. the IRS audit always says they have no record of the individual pensions or annuities. thus they audit me. they also do not recognize turbotax use of the General Rule
- Cnet.com User Review
For professional tax preparers, tax season is busy. Super busy. Some of us leave the house before our kids are awake and get home after they've been put to bed. But, they understand why we do what we do. So with time being so limited it's hard to find an extra hour, or in this case, 2 hours and 15 minutes to basically waste, but I do it anyways.
Every year I find the time to go through the process of preparing my personal tax return through Turbo Tax. I go through this experience to help me understand what my potential clients are experiencing when they try to prepare their own tax returns with tax software and also so that I can give my honest opinion of the usefulness of such programs. This is never something I look forward to because I am spoiled by getting to use professional grade tax software that is designed simply and for ease of use. TurboTax is a lot more work for someone like me who just wants to get to the forms that need to be filled in. But I digress. Here is a brief overview of how my experience played out this year:
So I had already prepared my return with my software and had gathered up the courage to log in to TurboTax and start the process. I didn't get so far as entering my user ID an password before TurboTax informed me that I would need to wait about 7 minutes before the program was ready for me. Fortunately they "invited me to the prom" and had me watch this video while I waited. To be honest I enjoyed the video and could have watched it for about 15 minutes, but instead I only had to wait about 5.
Energized by the awesome prom video, my goal was to finish my return as fast as I possibly could given that I had already organized all of my tax information and even prepared my return already. I was anticipating spending one full hour entering all of my information. I consider myself a pro TurboTax user so I opted to select the sections I needed to edit on my own. I began plugging in income information and I was promptly notified that I would need to upgrade to the Deluxe version for an extra $29.99. OK, no problem, I know I have a bunch of stuff I need to write off so I figured, it's worth it.
I continued plugging in information and here came my second notification of a need to upgrade. TurboTax needed me to upgrade to their "Home and Business" version which would cost me $74.99 at the current promotional price. No big deal, I have a home and business so that sounds like the right program for me and it's still cheaper than spending $100+ for a professional to file my taxes.
I started getting tripped up a little entering business expenses, because the categories seemed to be a little too broad. I wanted to enter phone and internet expenses, but TurboTax wanted me to enter that information into the office expenses category instead of the utilities category. It didn't really make a difference although not technically the most accurate way to report the expense, it was still an office expense. I fumbled around entering business expenses for about 45 minutes until I had everything deducted whether it was in the right spot or not.
I went through all the categories entering my home mortgage and property taxes. I deducted charitable donations and car registration fees. TurboTax automatically calculated and deducted my total income tax paid. I had to get used to the nuances of the program like making sure to enter a zero before any single digit date information and being careful not to click the back button on my browser window. I had to enter quite a few stock purchases and sales which TurboTax required me to enter individually instead of in aggregate as required by the IRS(but I'm assuming this is to help with accuracy), so that was a process that took a lot longer than I anticiapted(imagine entering the names, sale date, sale price, purchase date, and purchase price for about 15 different stocks instead of just the combined totals of sale price and purchase price). I watched my refund fluctuating up and down until finally, I felt like I was finished.
I looked at my refund total and noticed there was no change in the the balance of the state return, but my federal refund was short about $200 from the return I had already completed.
At this point I had spent 1 hour and 45 minutes preparing my return on TurboTax and was getting a little weary. Especially now that I had a discrepancy. I know that the return I previously prepared was accurate as I use the same software used by the IRS to prepare returns. When there is an error on a TurboTax return, it is very difficult to locate because they do not permit you to review the actual tax return before paying for and submitting it. You must locate the error by going around in circles through their software.
Eventually I uncovered the fact that TurboTax never prompted me to enter sales tax for a large purchase I made earlier in the year. Taking this sales tax deduction instead of the state income tax deduction saved me about $200 extra in taxes. After correcting this oversight, I still found that TurboTax was projecting a federal refund that was about $30 less than I should have gotten and the total cost of filing with Tubotax would be $111.98 plus 2 hours and 15 minutes of my time. To have this same return prepared by my office would have taken approximately 1 hr and cost $150. Was it worth it? You would have saved $38.02 in preparation fees, but lost $30 of your refund(assuming you caught the sales tax deduction like I did). Which means you ultimately would have saved $8.02. Spending two hours of your time to save $8.02 would mean your time is worth $4.01/ per hour. Your time is worth more than that isn't it?
The majority of our clients pay $79 to have their returns filed by us. Is do-it- yourself tax software really worth it?
- Cnet.com User Review
The software is fine and dandy until it puts something in the wrong box (and it was a software glitch, not me--the rep acknowledged that) and no one notices until after you submit, because you trust your tax software to know where to put your income on the form. Then, it just might not let you delete that income or even change it to zero, and the customer service rep might walk you through a process that ADDS the same amount somewhere else (two other places) and doesn't take it away at all. Suddenly, your generous return becomes thousands of dollars owed.
-Consumer Affairs User Review
What they do is somehow get you to fill out your info with the basic 19.99 version. Even though you think you are using the free version. Then once you're finished they tell you your charges. Who wants to do it all over again?
-Consumer Affairs User Review
It keeps telling me that some forms are not available. I updated the software so many times and still no avail. Now, I have 3 days and it still gives me an error that my e-filing didn’t go through. I tried so many times. I called customer service and finally got hold of someone after 45 mins, but she transferred me and I was on hold for another 30 mins. Then she said she would transfer me again but couldn’t hold on the phone anymore.