Making tax prep easier

March 7, 2007

If you’re like millions of other people, you haven’t begun your taxes yet, or you find yourself losing hair (hey, don’t look at me, I’m bald) over the complex paper tax forms and tables. There’s hope, other than the deadline being on April 17th this year: Turbotax.

turbotax logoTurbotax, by Intuit, provides a really fine do-it-yourself online tax preparation service. Sign up, and then Turbotax would ask you a series of easy-to-understand questions in selecting which tax form is right for you, figuring out your income and deductibles, and totalling your taxes and credits. It applies all of the arcane and finer points of tax codes toward your stuff, and keeps a running tally of how much you owe (or, if you’re lucky, how much you would get) as you work through the questions. There are extremely helpful help menus helping you understand any question. (Lots of help here – get it?) Turbotax has both Federal and state forms, and you can either print them and send out via the mail, or electronically file these forms via Turbotax. If you electronically file, you could expect to get your refund within days or, at the most, a couple of weeks.

Turbotax even remembers your information (but you’d better not forget your user ID and password a year from now). This comes in very handy – you don’t have to fill in information on your employer, spouse, and children again and again. It even remembers your income and deductions from the year before, and displays them as you work through the questions.

Please note that Intuit also offers a separate tax preparation program that you can purchase and use on your computer.

I thought I would have a particularly difficult time with totalling up all my gains and losses from the sale of various stocks. (All penny ante, I assure you – nothing really “wow”!) Turbotax made it relatively simple, although I think this could be improved upon. If you need to jump back and forth from one section to another, you do so via an index of topic materials (with completed topics checked off) – not great, in my opinion, and could be improved.

All these comes with a price, but not always. Fees for filing Federal forms range from free (if you file using a simple 1040EZUncle Sam form) to $74.95 (on sale from $99.95), depending on which form you end up with and which service you select. You don’t pay until you are ready to file. The higher level of service you select, the more you pay — i.e., the service that helps you with deductibles is $29.95 (on sale from $49.95), another that helps you with investments is $49.95 (on sale from $74.95), yet another that helps you with your business is $79.95 (on sale from $99.95). The fee for filing state forms is a flat $29.95.

The fees can be a bit of a bite out of your refund, but the ease of using Turbotax makes doing taxes and paying these fees (almost!) a pleasure. Now, go forth and make your Uncle proud. Our dear Uncle Sam, that is.

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