Why I always use TurboTax to do my own taxes
During my childhood, one of my dad’s yearly rituals was organizing his income tax paperwork on New Year’s Day. He would sit at his home office desk, receipts spread out in piles around him, stacks of paper littering the floor, and a calculator next to him. This was in the 1970s and 1980s before computers were ubiquitous household items. As well as having a full-time job as a school administrator, my father (and mother) owned a restaurant and some rental property so their income tax situation was never just a straight 1040 tax form.
And so, like my father before me, I’ve always done my own income taxes. When I first started filing on my own, I fell into the one job 1040EZ form camp. This was still before home computers. I’d go to the post office, pick up the form and fill it out by hand. In 1994, I acquired my first home computer: a bulky 17” monitor with a heavy tower). When I filed my taxes that year, I used TurboTax. This was when you had to go to an actual store and purchase a box that had a compact disc with software in it.
Since 1994 my income taxes have become increasingly more complicated. Because I work in film and television – often on more than one show per year, sometimes in more than one state – I receive multiple W-2s (my highest per year number was ten). I also have a side business and a plethora of 1099 income (both non-employee compensation and rents). Itemizing consistently gives me a significantly higher deduction than the standard one. This is all to say that my days of filling out a 1040EZ are long gone – as is the actual EZ form.
The majority of my colleagues have a tax guy whom they pay every year, though it can be difficult to find one well versed in how film and television crews get paid that has availability. Sometimes I contemplate using a professional but, to me since you still have to gather and organize all your receipts and W-2s and the like for a tax guy, why not just enter all the information yourself? I also may have some control issues.
How to use TurboTax to do your own taxes
One of the main reasons I continue to use TurboTax to do my taxes is because the program keeps track of all the information from previous years, which can be downloaded and stored as both .tax and .pdf files. The program is (obviously) kept up to date on all tax laws and rules. In many instances, you can electronically transfer your W-2 information (if supported by your employer). A nice feature that was new to me this year was that you can upload a PDF of a 1099 or W2 form and the program will automatically input the information – much better than having to manually type everything in (as it’s been in years past).
The online-based software allows access to help files, as well as 24/7 support from specialists and other customers. Before filing, the program runs a review to make sure you’ve completed all the forms you need to. TurboTax offers a “guarantee” that all calculations will be correct and includes audit support if needed.
There’s also an “audit defense” option available for an additional $60 which comes with identity theft monitoring and restoration. Whether or not you actually need this kind of coverage is debatable. While it certainly provides peace of mind, if you actually did have to go to court over an audit, it doesn’t include legal representation.
In all my years of filing with TurboTax, I’ve received two “audit” type questions in the form of letters asking for more information and/or clarification. Both were from the state of New York and had to do with real estate in New York City (I own a coop apartment) and were easily resolved by me simply submitting the information requested. In keeping with this, I will say that the one time I did call one of TurboTax’s tax experts it was in reference to real estate taxes in the city and they weren’t able to help me. To be fair, NYC real estate pretty much functions in its own wild west as opposed to the rest of the country but Intuit should really ensure they have experts who understand it.
TurboTax is free for simple tax returns (also, not all taxpayers qualify).
The $59 deluxe version allows for itemizing, the $89 premier version adds coverage of rental property income and investments and the $119 self-employed edition (which is what I use) offers guidance for freelancers and business owners. Each of these is often available slightly cheaper on Amazon as a download – or even an old-fashioned disc. Ahead of tax season, all of this software is currently on sale at Amazon.
These prices only include filing your federal form. Each state is $54. For additional money (about $60), you can also use the “TurboTax Live” version where you get advice as you go, along with a final review from a professional. There’s also – new this year, I think – the option (for even more money) to have someone do your taxes for you.
TurboTax doesn’t necessarily cost less than going to an accountant or other tax service but I personally like knowing exactly what I’ve deducted and were and that I’ve filled out everything myself.
If you’ve been using the same tax person for years, there’s probably no real reason for you to switch – unless you’re like me and have control issues and actually enjoy the process. Also, it’s important to note that you do not have to use any tax preparation software or professional person to do your taxes if you don’t want to. You can go complete OG, just as my dad still does, and do everything old school – though I think my brothers and I finally convinced him that e-filing is more efficient.
Written by Vanessa Nirode for SFGate.