Warning: Rant on Tax Software

[almostthere]

I am so angry that I got taken in by H&R Block's online tax software. State and Fed cost me $80. I really should have shopped around. It seemed I could have gotten the same software from Amazon for $20 (Not sure if that is an inclusive of any other fees.).

I just used them in a knee jerk 'oh I used them last year' sort of way'. I will shop around next year. It seems that there are a number of competitors.

Aside from paper and pen and mailing them in, does anybody have any recommended software that does the basics plus 1040 schedule B and Schedule D for investment income and sales?

[slsdly]

In Canada, we have StudioTax. Free and runs locally (die "cloud"!!).

http://www.studiotax.com/

[Chad]

@almostthere
You can get most popular tax software for about $20 during a promotion/sale. That's what I paid for mine this year. This will include federal and one state return. If you want it even cheaper, or you missed the sale, just file an extension and buy the software in August when they are desperately trying to unload it. I have done it a couple times.

[Ego]

I download the fillable pdf forms and fill them in myself then print and mail. Years ago I used turbotax and didn't like the fact that they did much of the thinking for me. When I reverted back to the old fashioned way and actually read the instructions, I learned some valuable lessons that allowed me to plan better for future years.

[Tyler9000]

I always browse for tax software through my Fidelity brokerage login, and usually get a discount. They generally don't advertise the deal so you have to dig, and the deal may vary based on account details. This year my Turbotax was free. YMMV, but it's worth checking out.

[blackbird]

We have used Taxslayer's website, I want to say it was $15 or thereabouts. Check prices carefully, I know one year there was a coupon and it cost us $10. Worth a read over anyway.

[almostthere]

@slsdly, one day the US will catch up to Canada's advanced culture
@Chad, as usual I like your style. I'll have to look into filing an extension from abroad. That could be a very handy option.
@Ego, I'd do paper and pencil but it would cost me $50 to DHL it to the States. I did that way for many years and you are right, it is a great way to learn.
@Tyler9000, I think Vanguard usually pushes TurboTax, I'll look more closely next year.
@blackbird, did you like taxslayer? I noted that it was new cheaper competitor. How were its dividend and capital gains sections?

[ereish]

I really like TaxAct. The federal return is free (with no income cap that some programs have for the free federal) and $17.99 for state. I also think it will let you fill out the state return for free and then not e-file, but for me it's worth the $17.99 not to deal with the paper filing maybe getting lost and have direct deposit on the refund.

It does try to up-sell, but you just have to click no on all of their premium features.

[blackbird]

@blackbird, did you like taxslayer? I noted that it was new cheaper competitor. How were its dividend and capital gains sections?

While we do have a little bit of that to deal with, I would consider it marginal compared to everyone else here. So the robustness of this particular piece of software in dealing with that is difficult for me to judge since I have not been faced with it in other tax packages. Overall though, I like the software a lot. We had tried using TurboTax a few years back and I do remember much preferring Tax Slayer.

[almostthere]

Republishing this from last year as there was some really good advice, and US tax season is upon us.

[RealPerson]

@almostthere
You can get most popular tax software for about $20 during a promotion/sale. That's what I paid for mine this year. This will include federal and one state return. If you want it even cheaper, or you missed the sale, just file an extension and buy the software in August when they are desperately trying to unload it. I have done it a couple times.

That is a good idea. Just remember that filling an extension does not mean you can extend the tax payment itself. Make sure the delay does not cause penalties and interest.

[enigmaT120]

A person from work gives me Turbotax. I offer to pay part for it every year but he won't take anything. It will be interesting to see how hard it will be to document my timber sale and expenses using the basic version.

[SimpleLife]

I use TaxAct online, and I get the deluxe version for under $10 every year (I pre-pay). Takes me less time than dealing with my CPA, AND I actually managed to get higher refunds.

[Chad]

@almostthere
You can get most popular tax software for about $20 during a promotion/sale. That's what I paid for mine this year. This will include federal and one state return. If you want it even cheaper, or you missed the sale, just file an extension and buy the software in August when they are desperately trying to unload it. I have done it a couple times.

That is a good idea. Just remember that filling an extension does not mean you can extend the tax payment itself. Make sure the delay does not cause penalties and interest.

Thanks, I know. I'm a former accountant.

[almostthere]

I decided on Taxslayer:Classic. From the available information on H&R BLock, Taxslayer and Taxact's websites, it seems to the the cheapest, $30 for state and local. On the whole, I was satisfied. I would recommend Taxslayer with one large caveat, you should be able to do your own taxes on paper before using the site. Taxslayer:Classic is filling in the form for you. If you need guidance or don't really understand the building blocks of the tax code, I'd choose something else. That said Taxslayer:Premium may do a better job, but it is more expensive. I ended up using H&R Block and Taxslayer side by side in open browsers until I could get both of them to match numbers. In the end, I felt very comfortable that I had done the major parts correctly.

[JL13]

you should be able to do your own taxes on paper before using the site.

What advantage does taxslayer have over freefillableforms.com?

[almostthere]

@JL13

I was intrigued, so I went to the freefilliableforms FAC.

"How is Free File Fillable Forms different from tax software?

Unlike most tax software, Free File Fillable Forms is a simple electronic equivalent of paper forms. It provides basic mathematical calculations and basic field error checking. It doesn’t ask about or explain tax situations, automatic calculations, or extensive error checking. The program provides forms for federal taxes only, while most tax software provides federal and state."

I'd guess the simple answer is no algorithm and no state taxes.

Taxslayer does have the same underlying algorithm as all the others. It is the same algorithm I'd use doing it by hand.

I think my advice that you mentioned above could be restated this way: if one knows what inputs the US federal and state individual tax system requires and approximately how the inputs are be transformed into a final tax return, then I'd use tax slayer. If one does not know this, go to a professional tax preparer or use high end software like TurboTax.

[JL13]

Most state forms are hideously simple. They just pull federal AGI. I download mine, put my name address and 3 numbers on there, print and mail it with a check. It takes about 10 minutes.

What's your algorithm?

[almostthere]

Thank you for your advice. You may be right. I have not actually done my State return by hand in awhile, so I should re-investigate how much work it would be to do. I live abroad in a country with a limited mail system, so I do like electronic filing, but that does not mean I should not look at all alternatives.

[JL13]

Eww foreign country yeah....that does sound like a pain.