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Slashdot Asks: How Do You Pay Your Taxes?

timothy posted about 9 months ago | from the what-you're-billed-and-what-you-owe-aren't-identical dept.

Government 386

April 15, 2014 isn't just a full moon: it's Tax Day in the U.S. That means most American adults have already submitted a tax return, or an extension request, to the IRS and -- except for a few lucky states -- to their state governments as well. I filed my (very simple) tax return online. After scanning the free options, since I live in a state -- Texas -- that does not collect personal income tax, I chose Tax Act's free services. That meant enduring a series of annoying upgrade plugs throughout the process, but I could live with that; I have no reason to think it was better or worse than TurboTax or any of the other e-Filing companies, but I liked Tax Act’s interface, and it seemed less skeevy in all those upgrade plugs than the others I glanced at. The actual process took an hour and 19 minutes once I sat down with the papers I needed. My financial life is pretty simple, though: I didn't buy or sell a house, didn't buy or sell stocks outside of a retirement account mutual fund, and didn't move from one state to another. How do you do your taxes? Do you have an argument for one or another of the online services, or any cautionary tales? Do you prefer to send in forms on paper? Do you hire an accountant? (And for readers outside the U.S., it's always interesting to hear how taxes work in other countries, too. Are there elements of the U.S. system you'd prefer, or that you're glad you don't need to deal with?)

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How do you do your taxes? (5, Funny)

turkeydance (1266624) | about 9 months ago | (#46756603)

actually, my taxes do me.

Re:How do you do your taxes? (2)

master_kaos (1027308) | about 9 months ago | (#46756821)

I use both ufile.ca ($10-15) and studiotax (free). I find ufile more user friendly, and you only have to pay if you want to netfile. So what I do is fill out in both ufile and studio tax and make sure the numbers are the same, if not I look to see what I did differently and which one is wrong, once they both add up to the same, I submit through studiotax so I don't have to pay.

base it around my OS (3, Interesting)

nimbius (983462) | about 9 months ago | (#46756607)

HRblock.com makes pretty quick work of taxes, and it works seamlessly in aurora in Gentoo linux. The only downside is the constant upsell. at some point you're clicking quickly because you just want to get shit done and accidentally upgrade yourself to a $120 tax package. After that, you literally cannot back out or restart.

Re:base it around my OS (3)

Orestesx (629343) | about 9 months ago | (#46756651)

I second HRBlock online. It keeps getting better every year. It saves all your old returns, and automatically signs your return with your previous years AGI. It's really very good.

Re:base it around my OS (0)

Anonymous Coward | about 9 months ago | (#46756773)

I used to use Taxact, but several years ago I switched to HRBlock Online and have used that since. I've looked at some of the other programs but didn't see anything of value to me over the online service.

Re:base it around my OS (3, Interesting)

93 Escort Wagon (326346) | about 9 months ago | (#46757033)

I've used TaxAct for quite a few years - it works well, and it's under ten bucks for most people. Heck, for a federal return it doesn't have to cost anything at all.

The IRS itself has gradually been making it easier to file directly with them, for free. Up until now my wife and I have fallen above the income cutoff they've artificially chosen; but it appears they've been gradually increasing their capacity over the past few years - I suspect, either next year or the year after, we all will be able to go to irs.gov and take care of it there. My taxes aren't that difficult, so having to use a paid service (or paper) just because I want to do them myself seems quite silly.

Re:base it around my OS (0)

Anonymous Coward | about 9 months ago | (#46756999)

Except that it's getting more and more expensive. I have the simplest tax returns, but for the luxury of having them transfer a few bits of info from the previous year (i.e. not having to type in my address, and answer the same stupid questions again), I've paid around $80 for federal+state filings. That's way too much.

fix the tax code for the 99.9% (0)

Thud457 (234763) | about 9 months ago | (#46757009)

The average person shouldn't need to buy some complicated piece of software or hire a witchdoctor to determine their financial obligations to the state. The system is a pitiful mess, and vested interests are working hard to keep it that way. When you appoint me emperor, you can bet I'll fix that up right good.

Re:fix the tax code for the 99.9% (0)

Anonymous Coward | about 9 months ago | (#46757097)

Let me guess, you'll just take 100% of everyone's income?

Re:base it around my OS (0)

Anonymous Coward | about 9 months ago | (#46757027)

Can you look at the source code? If not, it's not an option.

Re:base it around my OS (0)

Anonymous Coward | about 9 months ago | (#46756783)

That costs way too much for "basic" preparation now.

Re:base it around my OS (2)

B1ackDragon (543470) | about 9 months ago | (#46756881)

For the first time in several years I haven't changed states, jobs, or marital status, so I was excited to do my own taxes*. I was used to getting a hefty refund though, so when I used hrblock.com and it showed a (small) debt I thought I'd go in for service figuring I had missed something. Turns out I am just about even in my witholdings, so I payed someone at H&R a good hundred bucks just to give me the exact same information. Sad day, but a lesson learned for next year I guess.

* Uh, excited relative to previous years I guess.

Re:base it around my OS (1)

Lost_In_Specs (843932) | about 9 months ago | (#46757007)

I worked at H&R Block for a tax season. I used TurboTax, and so my manager and a lot of the people I worked with there. I'm not sure how their online service is now, but the year I worked there, they screwed up a bunch of their e-filings royally. It was ugly.

Re:base it around my OS (1)

Rob the Bold (788862) | about 9 months ago | (#46757061)

. . . at some point you're clicking quickly because you just want to get shit done and accidentally upgrade yourself to a $120 tax package. After that, you literally cannot back out or restart.

You can, but it requires human intervention from customer service and takes a few hours. Obviously, this would be a problem if it happened at the last minute

Title is Not Properly Descriptive... (3, Interesting)

Anonymous Coward | about 9 months ago | (#46756611)

...it should probably be "How Do You File Your Taxes?", as the content has nothing to do with how taxes are paid, really.

Re:Title is Not Properly Descriptive... (-1)

Anonymous Coward | about 9 months ago | (#46757107)

."..it should probably be "How Do You File Your Taxes?", as the content has nothing to do with how taxes are paid, really."

Thanks for explaining that, Internet Aspie! I was confused there.

tax carried interest! (-1)

Anonymous Coward | about 9 months ago | (#46756643)

tax the jews!

How I pay them? (0, Offtopic)

Anonymous Coward | about 9 months ago | (#46756649)

With tears in my eyes...

I mail them a check (1)

EmagGeek (574360) | about 9 months ago | (#46756655)

I send in my pound of flesh yesterday.

Some third party companies accept credit and debit card payments on behalf of the IRS for a fee. I think you can also just put your routing and checking number on your 1040 form and they will debit your payment directly via ACH.

As far as filing, my accountant prepares the 50 or so schedules and forms that I need to send in every year...

Had to do paper for a few years (3, Interesting)

sandytaru (1158959) | about 9 months ago | (#46756675)

I tried to efile a few years ago and discovered someone had already submitted a tax return under my SSN. So I had to send in all my tax forms and all my proof of identity in paper, along with a statement of fraud or something of the sort. And I had to file paper again the next year since my SSN was blocked from efiling due to the fraud alert.

Finally got the ability to file normally again last year. We don't qualify for the free tax software any more, unfortunately. I think we used the paid version of Turbo Tax.

Re:Had to do paper for a few years (2)

bzipitidoo (647217) | about 9 months ago | (#46757083)

Try Tax Act. The free version will nag you to upgrade, but you don't have to, and they no longer put income limits on the efiling.

Limits were always one of the many stupid things the IRS did. The IRS wants everyone to efile, not send in paper, becuase it saves them money. Then they try to charge extra for efiling, which drove people to file paper. Also heard that the chances of being audited are lower for paper filings, another reason not to efile. I didn't know about being forced to go with paper to deal with identity theft, but it figures. We've never had that problem, and we've always gone with whichever way was cheaper. We were not going to pay an additional $15 or whatever the charge was, to efile.

Tax Act vs Turbo Tax (3, Informative)

Gim Tom (716904) | about 9 months ago | (#46756685)

I have used Tax Act since changing from Turbo Tax when they tried to push a DRM version on us. This was a long time ago. I probably would not have changed except for that, but since then I have not looked back. With Tax Act I always buy the Deluxe Download for both my State and Federal taxes and that gives me a free e-file and unlimited paper filings. Over the years it has served me and my late wife well through the passing of both her parents and preparing their final returns and also my Father's passing and the issues with inheritance and estates. My tax preparation over the years has ranged from very simple to far more complex than I would ever have imagined and I have had to contact the Tax Act support via email on both technical issues of HOW to do something also Tax issues of WHAT I needed to do. I have always gotten very helpful and prompt responses and this year was no exception. Although I am moving more and more to Linux I am GOING to keep at least one Windows machine around just to run Tax Act if nothing else!

Re:Tax Act vs Turbo Tax (1)

Shados (741919) | about 9 months ago | (#46756885)

The web interfaces that several tax tools have been moving to kind of solve the problem of the operating system. I never used Tax Act, but I don't think I could ever get myself to download a tool to do my taxes.

Re:Tax Act vs Turbo Tax (1)

Dave Taylor (3466517) | about 9 months ago | (#46757089)

Yep. I'm using TaxAct Online now. Downloading is annoying. When I was using the TurboTax app (up until 2 years ago), it seemed like I spent more time downloading upgrades to the thing than actually using it.

Re:Tax Act vs Turbo Tax (1)

jaymz666 (34050) | about 9 months ago | (#46756915)

I also use Tax Act, and get the Deluxe version, however it always charges me to file the state return. Do you have to pay to file your state return?

Re:Tax Act vs Turbo Tax (3, Interesting)

Rob the Bold (788862) | about 9 months ago | (#46757031)

Although I am moving more and more to Linux I am GOING to keep at least one Windows machine around just to run Tax Act if nothing else!

Tax Cut (H&R Block) online works with Linux browsers. Turbo Tax online complains but works anyway. And Tax Act online at least let me start without any warnings. There really seems to be little difference in the online versions of these services vs the installable Windows program, FWIW to you. I replaced my Mom's XP with Ubuntu and switched her over from Turbo Tax for Windows to Turbo Tax Online. Except for the (apparently bogus) warning when first starting, it worked fine, and she didn't really notice a difference in the experience from last year.

The paranoid might be concerned about filling out their taxes online, but the truly paranoid would note that an installable program could just as easily "phone home" with your tax info, anyway.

BItCOIN! (4, Funny)

Lumpy (12016) | about 9 months ago | (#46756691)

Suck it tax man, Accept my bitcoins!

We don''t do tax returns in the UK,you insensitive (5, Interesting)

fantomas (94850) | about 9 months ago | (#46756701)

The majority of people in the UK who work for an employer (rather than self-employed), and don't have other income to declare (e.g. part time self-employed in their own hobby business, renting out a property, or rich enough to be generating significant income from investments or savings) don't fill in tax returns, it is managed by their employer through Pay-As-You-Earn [wikipedia.org] . As wikipedia says "because the tax code reflects other income (including the state pension), the PAYE system typically results in the correct amount of tax being paid on all the income of a taxpayer, making a tax return redundant".

Let the flamewar begin :-)

Re:We don''t do tax returns in the UK,you insensit (0)

Anonymous Coward | about 9 months ago | (#46756745)

"From each according to his ability; to each according to his need."

Re:We don''t do tax returns in the UK,you insensit (1)

93 Escort Wagon (326346) | about 9 months ago | (#46757093)

"All animals are equal, but some animals are more equal than others."

What about capital gains or dividents? (0)

Anonymous Coward | about 9 months ago | (#46756797)

Are those handled automatically too? I'd kind of like that actually.

Re:What about capital gains or dividents? (1)

jabuzz (182671) | about 9 months ago | (#46756877)

Yep all taxed at the lower rate of tax unless you declare that you are not a tax payer. If you are a higher rate tax payer you will be doing a tax return and have to pay the extra.

Re:What about capital gains or dividents? (1)

SirAudioMan (2836381) | about 9 months ago | (#46756929)

I have always wondered why it's not like that in Canada too...oh wait because the government can't keep track of simple things like where 1 billion dollars goes for a cancelled gas plant....

Re:What about capital gains or dividents? (1)

mrg17 (36780) | about 9 months ago | (#46756983)

Not all higher rate tax payers have to do a return either. (Then again with gift aid and pension contributions relief even defining a higher rate tax payer can get complex - there was a big fuss recently over child benefit and the fact a particular claw back only applied to net relevant earnings rather than all earnings)

Re:What about capital gains or dividents? (1)

jabuzz (182671) | about 9 months ago | (#46757063)

True but if you have any sort of investment, or get any interest from savings (that is not in a tax free savings account) then in reality you should. That's means most higher rate tax payers should be doing tax returns.

Re:What about capital gains or dividents? (3, Interesting)

bickerdyke (670000) | about 9 months ago | (#46756953)

Germany here, but PAYE applies here too. It's similar for capital gains: The bank automatically sends your estimated taxes to the tax office. At the end of the year, you get a report. Exactly as you PAYE report, it contains a transaction ID which can be used to refer to those advance payments when you want or have to actually file your taxes. (If you can expect a refund, you may file one, if you have other income besides the advanced-taxed income, you have to)

Re:We don''t do tax returns in the UK,you insensit (1)

Shados (741919) | about 9 months ago | (#46756855)

Of course the US tax code is like, what, the second most complicated in the world or something? (I think Germany has it worse?), which is a problem in itself.

That said, what you describe definately seems like it would work quite well for people who just work for an employer, as you mentioned.

But here at least, the amount of people who are either self employed, do free lance on the side, or have some kind of investments, is a pretty damn large portion (on top of my head I actually don't know a single person who does not fall in one of those categories...of course its because of where I live and is not representative), so, at the very least, it wouldn't help me much :)

Re:We don''t do tax returns in the UK,you insensit (1)

clickclickdrone (964164) | about 9 months ago | (#46757071)

But here at least, the amount of people who are either self employed, do free lance on the side, or have some kind of investments, is a pretty damn large portion

But at least with the UK system, the bulk of your tax is already covered. I used to submit a self-assessment return online here as I bought/sold shares and had a second job writing magazine articles. I just had o add the details plus expenses I was claiming to offset these, online and the system works out what you have to pay (and takes into account your existing tax from your primary job). You then have a choice to pay it in a lump sum or change your tax code so you pay it off each month (there must be limits to this, not sure, never used this option). The online system is great, loads of information, a clear step by step process and it does all the calculations for you. You can do it bit by bit and it remembers all your details to date. When you finally submit it you get a downloadable PDF that looks just like the paper version but nicely filled in.

Re:We don''t do tax returns in the UK,you insensit (0)

Anonymous Coward | about 9 months ago | (#46756911)

It's pretty similar in Sweden, if your only income is "visible" to the government. "Visible" in this sense means that others than you are required by law to report the income to the tax office: your employer will report your yearly wages, your bank will report your yearly interest. Any other income you must report yourself, but very few Swedes have any other than wages and bank interest.

This means that most Swedes get away with just signing the form the tax office has sent them, with all the numbers filled in already. Only if any of these numbers is wrong do you need to write anything yourself. And if you don't like to waste good ink on paper, you can just send them an SMS or do it online.

Anybody that has sold stock must report this themselves. The tax office will be told by your broker that you have sold stock, and in which companies, but you have to tell them how much profit you made. This can be done online or on paper, as you choose.

For most people doing their Swedish taxes online, the system is set up in such a way that you cannot submit an incomplete tax form: if you have sold stock, or made money as a self-employed contractor, you must fill out the forms for each.

Re:We don''t do tax returns in the UK,you insensit (0)

Anonymous Coward | about 9 months ago | (#46756949)

That isn't much different than in the US, however you are still required to file a return in the US regardless if you owe anything, owe nothing or are getting a refund.

Work place withholding typically doesn't take all deductions or tax credits in to account, nor does it consider taxable interest and investment income. I work in a small office of 10 people, I'm the only one in the office that actually has to pay at tax time. Everyone else gets a refund of some sort.

Last year I owed $200, this year it was under $20, most of the extra that I owe came from investment accounts, work place deductions would have provided me a small refund.

Overseas comment (4, Interesting)

DeathToBill (601486) | about 9 months ago | (#46756705)

I like the UK system - if you're an employee and you're happy with the tax your employer has withheld on your behalf, you don't have to do anything. You get a statement at the end of the year telling you how much you've been paid and how much tax has been withheld - if you think they've got it wrong, or you want to claim deductions, you file a tax return saying so.

Re: Overseas comment (0)

Anonymous Coward | about 9 months ago | (#46756917)

In the US though, we use the tax code as a secondary system of divvying money out to people though as well, so this would never work. With the multitude of deductions and credits available to people, the tax paperwork every year is essential to getting your piece of the government money pie.

Re: Overseas comment (1)

mrg17 (36780) | about 9 months ago | (#46757021)

Whereas in the UK a number of benefits have application/renewal forms that look a lot like a tax return but are actually separate.

Re:Overseas comment (1)

mrg17 (36780) | about 9 months ago | (#46756967)

And often you can simply write a letter, in simple cases you don't have to file a full return.

TurboTax (2)

jythie (914043) | about 9 months ago | (#46756717)

Not an ideal solution, but it has served me pretty well. My taxes have been varying levels of complexity over the years and I liked having the same UI for handling a variety of needs. Free would be nice of course, but I consider the cost of the package (compared to the amount of money involved) worth it for the convenience.

Re:TurboTax (2)

i.r.id10t (595143) | about 9 months ago | (#46756825)

Same here... I use hte $50 version, fed taxes only (Florida has no state income tax). Worth every penny, and since I've been using it every year for the past 6 or so it imports my prior returns and uses them as a starting point. Handles investments (stocks), mortagage interest,etc. and lets me efile. Works great in Firefox on Mint (and Ubuntu and Debian before that).

Re:TurboTax (1)

DigiShaman (671371) | about 9 months ago | (#46757191)

TurboTax. You get to keep a history and I've had to call their line for consultation once. I was pleased with how it all went. Their online FAQ forum was pretty useful in fact.

To each his own, but if your tax situation is really complicated, perhaps you're living a life beyond your pay grade? Or perhaps we should go with a fair tax system. It's way too bloated and complex as it is. If I was forced to do this on my own with nothing but paper and instructions from provided PDFs via IRS website, no doubt it would have been an epic failure for me.

with a brick and a rubber band (-1)

Anonymous Coward | about 9 months ago | (#46756719)

Step 1: tie money to brick toss trough window of IRS.

Step 2: feel content and walk away like a boss.

render onto series continues.... (0)

Anonymous Coward | about 9 months ago | (#46756721)

tears & innocence are our new clear genuine native currency? any shortages of those can be attributed to our process of devaluing ourselves

How do I pay my taxes? (1)

mistaryte (2446492) | about 9 months ago | (#46756733)


I just use TurboTax (2)

Shados (741919) | about 9 months ago | (#46756739)

Filing taxes is annoying enough, and even the "premium" options are just not that expensive for anyone in our field with a job (if you're not in that category, its a different story, obviously), that it just doesn't matter.

I do have a condo I just bought, I'm married, and I do have stocks, but using the appropriate TurboTax option, I basically just punch in some information, and it retrieves my W-2s and tax papers. Punching in the real estate data takes 5 minutes. So all in all, about 45 minutes for both people and forget about it.

Only annoyance was that the e-filling for stocks wasn't available for like, a month after I tried to file, so I had to wait a bit to submit the whole thing, but considering the amount the IRS wants from me, I wasn't in any particular hurry.

How Do You Pay Your Taxes? (1)

slapout (93640) | about 9 months ago | (#46756741)

With money

A good accountant (0)

Anonymous Coward | about 9 months ago | (#46756743)

I have a mildly complex tax situation with having some stocks and my wife having her own business so we had an accountant do ours this year. It cost me $120 for everything front to back... the last time I bought TurboTax it was like $100 anyways, PLUS $50 to file my state return, so for our situation the accountant was a no-brainer. I'd say most of the time its a different case person to person, and like most things, there is no blanket "best choice all around"

In Switzerland (5, Interesting)

krouic (460022) | about 9 months ago | (#46756753)

Here in Switzerland, canton Vaud, Tax Day was March 15. It is quite easy : you download a Java app from the government Web site. It works on Windows, Mac or Linux. You can open last year's return to prefill the relevant information, then you are guided through the application as to which fields you need to fill. When done, the electronic form is sent back, encrypted, to the government. In many cases, you do not need to join any other justification document, but they may ask you for them later. Usually, you do not need to send your salary statement either because your employer is required to send it directly to the government so they already have it.

Re:In Switzerland (1)

93 Escort Wagon (326346) | about 9 months ago | (#46757117)

Here in Switzerland, canton Vaud, Tax Day was March 15. It is quite easy : you download a Java app from the government Web site.

I don't want a Java app anywhere near my financial information.

OpenOffice of course (0)

Anonymous Coward | about 9 months ago | (#46756755)

I have a big old spreadsheet I use every year. It isn't that hard. I did find
a much more complex spreadsheet out there but didn't use it this year.
Then the data goes in a fill-outable PDF so nobody's exposed to
my horrible handwriting.

Retired, so (1)

alfredo (18243) | about 9 months ago | (#46756781)

I do it old school, pen on paper.

Paper Forms (2)

timeOday (582209) | about 9 months ago | (#46756793)

If you just have one or two W2s and 1099 I find paper to be the easiest. I tried the eFile system and it requires you to type in all the codes on the W2s which is torture. 45 minutes and I'm done.

Re:Paper Forms (1)

kannibal_klown (531544) | about 9 months ago | (#46756935)

If you just have one or two W2s and 1099 I find paper to be the easiest. I tried the eFile system and it requires you to type in all the codes on the W2s which is torture. 45 minutes and I'm done.

I guess it depends on your employer. The current tax programs will let you type in some serial number from your W2 and it will connect to some repository and download all of the W2 fields so all you have to do is eyeball the results when they're done to make sure it looks right. But I guess your employer has to opt into said service.

Personally I like the way some of the apps (like TurboTax) phrase the descriptions when asking about deductions. My living situation seems to change every 2 years so every year or so I have to see if [A] affects me or not... and they offer plenty of help to let you know whether you are affected by something or not.

Dependent -> renter -> home owner -> etc.

H&R Block and Turbo Tax (1)

slapout (93640) | about 9 months ago | (#46756801)

I mostly use H&R Block. Usually cost between $100-$200 but they do it quicker than I could and (I hope) are less likely to make mistakes.

This year, however, we went with Turbo Tax Online because that's what my wife wanted to do.

Please don't use TurboTax (0)

Anonymous Coward | about 9 months ago | (#46756813)

Please choose an alternative to Intuit products. Our tax system should have been reformed to make filing easier long ago (e.g. the IRS already has most of the information you enter into your tax forms). Intuit is one of the few companies consistently lobbying against making individual tax filing easier:

Ars article on Intuit astroturfing campaign [arstechnica.com]

#irc.7rooltalk.com (-1)

Anonymous Coward | about 9 months ago | (#46756817)

IS D)YING. FACT: [goat.cx]

my situation is similar (1)

buddyglass (925859) | about 9 months ago | (#46756819)

Live in Texas, pretty simple tax return. I've always used TurboTax online and never had any complaints. I think I chose the $30 option.

Paper and US Postal Service (3, Interesting)

DERoss (1919496) | about 9 months ago | (#46756823)

U.S. and California

I have a degree in mathematics. Tax returns and their computations are merely a simple mathematical puzzle, which I easily solve.

I created two spreadsheets, one for federal income taxes and one for state income taxes. The latter is linked to the former because much of the California computations require inputs from the federal forms. Each year, I copy the prior year's spreadsheets into a new folder. I download the fill-in PDF forms for both governments and update the spreadsheets accordingly. I mark in yellow the spreadsheet cells that require new inputs; as I input those data, I remove the yellow.

California provides a Web site where I input my taxable income and filing status. The Web site tells me how much tax to pay. I wish the IRS would do the same. However, it is much easier to input into the IRS PDF files than into the California PDF files.

Since I have a large investment in a mutual fund, I can also get Turbotax for free. I download it and use it to check my spreadsheet results. I don't really like Turbotax because it requires too much irrelevant input and because it does not provide adequate capability to include explanatory attachments.

I print the PDFs and mail them via U.S. Postal Service. I never request certified or registered mail. I mailed my first tax returns when I was 16 years old. I am now 72. I have never had a mailed return go astray.

Re:Paper and US Postal Service (5, Insightful)

jratcliffe (208809) | about 9 months ago | (#46756865)

"Tax returns and their computations are merely a simple mathematical puzzle, which I easily solve."

None of the operations are very complex (add, subtract, multiply, divide), but knowing which numbers to perform those computations on, is sometimes far from simple. Get some K-1 income at some point, and see if you think taxes are still a "simple" puzzle.

Why... (3, Interesting)

ArhcAngel (247594) | about 9 months ago | (#46756839)

Slashdot Asks: How Do You Pay Your Taxes?

I PAY my taxes with Bitcoins OBVIOUSLY!

How do you do your taxes?

I use TurboTax every year and have never been disappointed. One year I decided to try HR Block since they are stalwarts in the tax filing industry (Why does tax filing need an industry?) and I was mortified at the lack of professionalism from their online and support staff. They cost me extra money and wouldn't assist me in correcting the error they caused. The tax "professional" assisting me couldn't even understand the simple concept of adult dependent attending college which I'm pretty sure is a common deduction. Their 2014 ad campaign (Get your billion back) infuriates me.

Grudgingly (3, Funny)

bickerdyke (670000) | about 9 months ago | (#46756847)

Grudgingly. I guess that's international.

Excel & Paper (2)

PseudonymousCoward (161283) | about 9 months ago | (#46756849)

I downloaded the workbook at excel1040.com, as I have for several years. I used a free version of TurboTax to validate the results. Once I was satisfied that I had entered everything correctly, I printed the relevant forms and hand-transcribed them to the IRS official forms. I mailed the paper forms yesterday. I try to print neatly, so that the poor transcribers (practically minimum-wage) at IRS can read the forms. In order to buy a version of TurboTax that would handle my federal and state returns, they wanted $140. I can't stand the thought of paying for the 'privelege' of filing my tax returns.

Re:Excel & Paper (1)

Nkwe (604125) | about 9 months ago | (#46757205)

In order to buy a version of TurboTax that would handle my federal and state returns, they wanted $140. I can't stand the thought of paying for the 'privelege' of filing my tax returns.

You aren't paying for the privilege of filing your tax returns; you are paying for the time you would otherwise spend researching, preparing, and filing your taxes. Was the time you spent worth the $140? (I am not saying that it was or wasn't, but the answer should be what drives your decision on if you do your taxes by hand or not.)

By the way, you should be able to purchase TurboTax for much less than $140. The "Home and Business" edition, which should cover the most complicated returns that an individual would normally need (home office deduction, stocks and options, property sales, etc) lists for $110 and can be found for about $80. If you have a simple tax situation, the even less expensive editions would suffice. Whatever the cost for tax software, the question of the software cost vs. the value of your time is what you should focus on.

Of course the question of why our tax system is so complicated that companies like TurboTax can sell software and find plenty of buyers is certainly valid.

HRBlock (2)

GodfatherofSoul (174979) | about 9 months ago | (#46756883)

I've e-filed for the past 10 years or so with all the major tax filing brands. Very easy and convenient; plus your returns are direct deposited so much faster. The only problem I've had was a couple years ago when I'd forgotten about several deductions and had to amend my return by mail (amounted to several hundred dollars as I recall).

My only complaint is that e-filing should be free software provided by the government and not commercial entities. Seems like that's the prerogative of the Feds, but those under a certain income bracket do get free filing and software.

Re:HRBlock (2)

CronoCloud (590650) | about 9 months ago | (#46757127)

My only complaint is that e-filing should be free software provided by the government and not commercial entities.

That was the plan. Some years ago, the IRS thought: "Hey! It would save a lot of time and paperwork if we could get everyone to file electronically. Lets start working on that and give away the software."

The tax preparation services caught wind of that and put an end to it. First by restricting who could originally e-file to licensed preparers (so that back in the early days e-filing could cost hundreds of dollars or more, putting out of reach of lower income folks) Eventually the IRS got pissed and had enough congressional allies to get a compromise.

Seems like that's the prerogative of the Feds, but those under a certain income bracket do get free filing and software.

Lower income and younger people get free-filing, in exchange for the tax preparers getting the middle and upper income folks and people over 52 so they don't lose their revenue stream. Course, the tax preparation/tax software companies do major advertising to sell their non-free boxed software and services and try to make people think they need them.

However some states were able to implement their own systems separately...which is why sites like HR block don't offer free filing in Illinois. Illinois hosts it's own solution, on it's own website, very easy and totally free and no upsell.

For the first time ever... (2)

jratcliffe (208809) | about 9 months ago | (#46756887)

I needed an extension this year. Some tardy 1099s, an erroneous 1099-R, a K-1 (that MLP just wasn't worth the hassle), a bunch of self-employment income, and it all just snowballed. Last couple of years I've used an accountant, but done them myself as a check, and to make sure I understand what's going on. Our results have never differed by more than a couple hundred $.

In The Great White North Eh! (5, Informative)

SirAudioMan (2836381) | about 9 months ago | (#46756891)

In Canada our tax day is April 30th...it's actually been extended this year several days due to the Heartbleed vulnerability found on the CRA's (Canada Revenue Agency is equivalent to the IRS) electronic filing servers. Yes, about 900 SIN numbers (similar to your SSN) were compromised!

Personal income tax forms (T1) are submitted to the Federal Government which includes any provincial forms/schedules that may be needed. All employment income is reported on a T4 as submitted by employers to the CRA but more importantly to each employee used to calculate any over/underpayments. There a dozens of other T forms for different things like investment income, educations deductions, etc.

Personally I report employment income, investment capital gains on my non-registered retirement savings, and this year some capital gains on a stock I sold to pay for tuition. I also report and deduct any retirement savings from my taxable income (RRSP's and Pension like a 401k). Generally, I have about 6-10 different papers that I need to co-ordinate before I begin to calculate things.

I used to use Intuit's TurboTax software, then switched to the online version but always found the software/website to be somewhat hard to use and poorly laid out. This year I found out about a new alternative web tax software for Canadian Tax called SimpleTax.ca. It's designed much better, and is actually free to use, plus it's CRA Netfile certified meaning it's been checked and verified by the Government. They ask for an optional donation at the end, which I'm sure is just temporary until they build a client base.

Normally I get a refund of anywhere from a few hundred dollars to a few thousand depending on a number of factors such as EI, CPP and Income Tax overpayments PLUS the benefits of deducting registered retirement saving (this makes a huge difference).


H&R Block online (4, Informative)

Rob the Bold (788862) | about 9 months ago | (#46756907)

I used H&R Block online. Unlike Intuit's offering, it doesn't complain that I'm using Linux. (Turbo Tax seems to work anyway after ignoring the warning, though.)

My financial life is pretty simple, though: I didn't buy or sell a house, didn't buy or sell stocks outside of a retirement account mutual fund, and didn't move from one state to another.

Trading stocks and funds in a non-retirement account used to be a huge PITA at tax time. Good news on this year's 1040 is that you can consolidate all your capital gains (or losses) by short and long term and avoid entering a line for every single trade. This quite literally saved hours of work.

Re:H&R Block online (1)

CronoCloud (590650) | about 9 months ago | (#46757195)

I used H&R Block online. Unlike Intuit's offering, it doesn't complain that I'm using Linux.

HR Block online used to complain about Linux. For years I'd comment and send an e-mail saying the OS check wasn't really necessary.

Income taxes? I'm an expat you insensitive clod! (3, Interesting)

Zocalo (252965) | about 9 months ago | (#46756925)

Some countries [wikipedia.org] don't even have personal income tax, and apart from the U.S. I don't know of any others that require their citizens pay income taxes on wages earned overseas. Admittedly several of the countries on the list are not the best places to live, but for non-USians it's perfectly possible to avoid paying income tax altogether.

Prefilled, confirm by SMS (0)

Anonymous Coward | about 9 months ago | (#46756947)

In Sweden, the authorities already know everything since your employer is required to send them your salary statement at the end of the year (there have been proposals to force employers to send this every month). All financial institutions do the same. Both pay your owed taxes automatically, so you never get tempted to spend the government's money.

So all salary, stock funds, interest, and other capital gains are pre-filled. Also many tax-deductible items come pre-filled (when you employ someone to do repairs on your house, the cost of work is deductible, and the invoice will come with the amount already deducted).

If you have no additions (most people do not), you can send an SMS or login to skatteverket.se and accept it.

Common actions like selling a house or stock require filling in a form, but this can also be done online. You are notified on the total taxes due or the date and amount that your tax returns will arrive (unless you are flagged for manual review).

The process takes me around 5 minutes a year. 30 minutes the year I sold a house and had to search my records for the figures.

Re:Prefilled, confirm by SMS (2)

PseudonymousCoward (161283) | about 9 months ago | (#46757067)

IRS has the ability to do something similar, for those with relatively simple financial situations (not for real estate tycoons). However, Intuit has lobbied against allowing them to do so, as it would kill their parasitic business. A couple of articles:

income tax? huh? (0)

Anonymous Coward | about 9 months ago | (#46756955)

what is this income tax everyone is talking about? I'm unemployed. lol I pay the sales tax that Amazon.com and the brick and mortar store charges.

Grudgingly, but more for the time than the cost. (0)

Anonymous Coward | about 9 months ago | (#46756957)

I pay my taxes grudgingly, but it's not the amount, it's the complexity.

The root cause of of the complexity of the US tax code is social engineering, but a significant proximate cause is from three UI problems that would be relatively trivial to address.

The first UI problem is that most IRS forms are two pages long, ostensibly to make them look simpler than they really are. The problem with a semi-official 2-page limit is that it requires you to switch forms every few lines. "Deduction for XYZ" - means "drop what you're doing, GOSUB FORM 1234", and on Form 1234 there's a phase-out or some other calculation, which in turn relies on a worksheet that's not actually part of any tax form, etc... (Canonical example: "(see instructions") - for Line 45 - the Alternative Income Tax, which requires you do redo your entire tax return using a completely different set of rules. But hey, it's only one line on Form 1040, so it looks easy to figure, and it only refers to one other two-page form, namely Form 6251. Four pages, right? WRONG!)

The second UI problem is that because most Americans are innumerate, most of the lines on the 2-page forms are wasted space. Instead of saying "Deduction for XYZ: Enter ((Line45) * 10%)) up to a maximum of $5000)" it reads: Line46: Enter 5000. Line47: Multiply line46 by 10%. Line48: Subtract Line47 from Line46. If the result is negative, enter zero.

By the time you've done three steps of arithmetic, you've forgotten what any of the numbers on any of the lines mean, and that brings the third problem.

The third problem is that although referring to lines on a tax form is unambiguous, it's meaningless. This year, Line 37 of Form 1040 is your adjusted gross income (AGI) - but most forms that refer to it don't say "Enter your AGI from Line 37 of Form 1040", they say "Enter Line 37 of Form 1040." The forms could be more self-documenting in this respect; by the time you're three GOSUBs deep in the stack of forms and dozens of meaningless arithmetic steps to calculate intermediate numbers, you've forgotten the quantity you're supposed to be calculating in the first place.

The only way to simplify the tax code would be to require every sitting member of the House and Senate to do their own taxes using nothing but a pencil, paper, and a four-function calculator, and to not let the bastards leave the chamber floor until they're done. If they starve to death before they simplify the code, re-elect new victims in their place and keep them locked in until they come up with a tax code that can actually be complied with. Fuck the IRS, and fuck Congress, and fuck Intuit and the multibillion dollar tax preparation software industry for lobbying to keep it the way it is.

It's better in the UK (0)

Anonymous Coward | about 9 months ago | (#46756959)

In the UK, taxes are taken directly from your salary. So if your income isn't complicated, there are no forms to fill in. Much better than the US.

Dedicated tax software on my PC (2)

Arethereanyleft (442474) | about 9 months ago | (#46756961)

I started with MacInTax the first year it came out, and I've used tax software on a computer ever since. I used MacInTax and TurboTax until Intuit added DRM a few years back and mishandled things. I switched to H&R Block that year. However, if H&R Block ever does something idiotic, I will switch to whichever competing product does a good job. I have not tried any online tax software, but I have friends and family who do and they like it. In general, it takes me about an hour each year to do my taxes. I do have a mortgage and taxable investments (stocks, bonds, and mutual funds) and sometimes other income, but I live in a state without income tax, so that makes things go pretty quickly.

With considerable annoyance... (2)

fuzzyfuzzyfungus (1223518) | about 9 months ago | (#46756963)

I think I chose 'Tax Act' based on price to e-file federal and state; but I was very displeased. Not so much by 'Tax Act', or even by the taxation(I, um, did my best to refrain from calculating how many years I'd need to buy Uncle Sam another slipped F-35 deadline, or a Literal Coffin Ship); but by the fact that I was, largely because of lobbying by Intuit and friends, paying to re-type numbers from a variety of forms the IRS already has. Seriously?

Yeah, sure, if you have some sort of complex arrangement get thee to a tax accountant, maybe even a suitable lawyer; but this was just redundancy for its own sake: I took a W-2 and a bunch of 1099s and a few other bits and pieces, all provided by various institutions to both me and the feds, and then retyped them into another form so that they could be submitted to the feds. WTF? That wouldn't even make sense for free, much less paying.

C'mon, IRS, just let me see what you think my return should be(you have to calculate it anyway when deciding who to audit) and I'll tell you if I have any changes or disputes. We'll both save time and trouble. How about it?

Groaning all the way (2)

coldfarnorth (799174) | about 9 months ago | (#46756965)

I use an accountant. Thankfully, I was ahead of the game this year and got everything filed a month ago.

But the worst part is getting the letter from the IRS saying that they'd adjusted my refund by $30 due to some minor error.

My feelings on the matter:
"If you knew how much money I was supposed to send in, WHY DIDN'T YOU TELL ME IN THE &@#$ING FIRST PLACE! It could have saved everyone time, money and trouble."

Turbotax (1)

Jeff Flanagan (2981883) | about 9 months ago | (#46756971)

I do my taxes and file via TurboTax. Their fee to do state taxes is outrageous, but I'm pretty lazy, and it saved me the hassle of filling out the form, buying stamps and snail-mailing my form and check.

Re:Turbotax (1)

Anonymous Coward | about 9 months ago | (#46757073)

I use TurboTax, look at the number the come up with for my state, then cancel out of the state & just file the Fed one with TT. Then I go fill out my state taxes on the state website, it's free and pretty easy once you have your federal form, certainly easy enough that it's not worth paying TT $39 to fill it out.

Grudgingly reluctantly... (3, Interesting)

140Mandak262Jamuna (970587) | about 9 months ago | (#46756975)

That is how I pay my taxes. But I do pay them. That is how I pay my taxes. I do not see taxation as theft, as many conservatives, libertarians claim. I see government as a long term venture capitalist, who invests in the entire next generation of America. Some of them will strike it big, and others will strike out. If I am one of the fortunate group that was able to take full advantage of the investment the government made in me, investments that protected my earning potential and my property rights, then the tax I pay is just dividend to the venture capitalist. So despite all the reluctance and the pain associated with parting with my money, I know it is the right thing to do. The government investment in the next generation depends on it. I can invest better on my children, and the government investment is creating competitors to my children. If I believed in Social Darwinism, I will fight taxes tooth and nail. But I believe human beings should rise above this level of self interest and pay the taxes. --

Depends (1)

UnknowingFool (672806) | about 9 months ago | (#46757015)

Most years, I just use the basic tax software. A few years when my taxes got complicated, I paid an accountant. For me, the few hundred dollars I paid was worth it for me not to be bothered by the IRS. Statistically they look about professionally prepared taxes less than self-prepared ones. Also the accountants always know about things that I can claim that I didn't know about. Each time, they were able to get me a refund.

Finland (2)

ultranova (717540) | about 9 months ago | (#46757029)

Here in Finland, the tax department sends me a tax card which tells how much to withhold each month based on my estimated yearly earnings, which I give to my employer. I later get a prefilled tax return based on my real earnings, which details any extra to be paid or returned. I check it, and if it's okay, I need do nothing.

A more cynical person might think a system where the market for tax apps or accountants for the average person exists is intentionally designed to make paying taxes difficult and aggravating.

uFile (1)

Anonymous Coward | about 9 months ago | (#46757041)

North of the border, in Canada, I have been using uFile for about ten years now. They are very reasonably priced and have a web interface which allows me to file taxes using any operating system which can run Firefox.

Pay a person (0)

Anonymous Coward | about 9 months ago | (#46757087)

I just have a local accounting place do my taxes. Part of my tax returns requires that I mail in proof of something for my state taxes. If I use the local place, they have some way of doing electronically that is not available to use plebs. Instead of a 1 month turn around, I get a 1-2 week turn around. I typically get my money back mid to late Feb.

Effective Tax Rate (2)

CMYKjunkie (1594319) | about 9 months ago | (#46757105)

I can luckily use a family member who is an accountant. She charges us a flat $50 fee and it's worth it because in 2013 we had: two kid deductions, cashed out some (very) small investments, sold a rental property short at a horrendous loss, got a tax bill for the "forgiven" debt on the short sale, and other hijinks.

In the press a lot has been made of the Romney's and Obama's "effective" tax rate: that is, "Adjusted Gross Income/Total Tax = Effective tax rate". Romney's was something like 14.1% and Obama's was 20.4%. Populist rage ensued over both "not paying their fair share." I felt that same rage but then looked: my effective rate was 9.53%!!!! That sure surprised me.

So /.ers: look at your effective tax rate - are you higher or lower than these "greedy bastards"?

Re:Effective Tax Rate (1)

CMYKjunkie (1594319) | about 9 months ago | (#46757153)

CORRECTION: Effective rate would be "Total Tax/AGI = Effective rate" which gives me (a lowly common citizen) 10.5%.

Twice. (5, Informative)

BabaChazz (917957) | about 9 months ago | (#46757109)

Annoyingly, I found out a couple of years ago that despite being a Canadian citizen and filing Canadian taxes every year, the US still considers me a US citizen for tax purposes, and so I have to file US taxes as well. Particularly annoyingly, one of the Canadian tax-deferral vehicles, the TFSA, is not recognized by the US, so I have this big complicated additional form to fill out for something it calls a trust. Plus I am CEO of a company I partly own (my consulting business), so I have to file financial paperwork for that as well. I hire an accountant, it's the only way to make sense of it all, and the US idiocy means that I'm out of pocket an additional $400 every year.

State and Federal supplied PDFs (0)

Anonymous Coward | about 9 months ago | (#46757123)

I download the pdfs, fill them in, print and mail. Takes me an hour or two, what with the alphabet-soup of federal schedules. State's much easier. Local's dead simple.

I used to use purchased software, but they all switched from simiple spreadsheet-like apps to fancy Q-and-A bs, which takes much longer.

I don't submit electonically, because as far as I can tell, you can't submit directly to IRS or state, you have to use some third-party intermediary, and I don't want any third party having that information. I don't trust them to not misuse it.

in the netherlands, there are no secrets anymore (0)

Anonymous Coward | about 9 months ago | (#46757133)

In the Netherlands the gouverment knows almost everything about your financial life. If you don't have to much money, only 1 house and work for someone you have it easy. The gouverment will fill out the tax form (digital form) for you and send it to you though a secured channel. The only thing you need to do is check if it is filled out correctly. The tax form took me 15 minutes to check and send back.

their slogan: it is not getting any more fun, but it is getting easier.

over 1 hour for a simple tax return? (2)

sjwt (161428) | about 9 months ago | (#46757175)

Ok, so what the hell!

A simle tax return hear in Australia done online with the free govermnt sofware ( http://www.ato.gov.au/Individu... [ato.gov.au] ) takes a lot less then that, hell it even data matches your taxfile number and pre fills feilds for you to check, hell it picks up tax decatiable medical expsense that i didnt even relise I coudl of claimed! Add in your work mileage and year type of car, how many uniforms washes you do a year etc.. and your filled and done extremely quickly, and you get faster processing due to online submission.

Done in 1/2 hour, and it tells you how much you are getting back or own then and their as a damm close estimate. You guys have to pay cash for programs for your tax? Sounds like your government really is screwing you, Can you even claim that back on your tax, tax based expenses??

I gladly pay someone to do my taxes for me (1)

enjar (249223) | about 9 months ago | (#46757185)

When I was younger and unmarried, I always did my taxes myself. For the first few years of married life, I did them as well. Even after buying the house and having the first kid I still did them -- me, TurboTax and a lot of frustration. Then came The Year Of The Thick IRS Envelope. Usually when you get a job offer or accepted to college, the thick envelope means "winning". Not so when you get a thick envelope from the IRS. That generally means Something Is Wrong. What came to pass was that my wife's employer at the time had reported a stock option sale incorrectly, and the manner in which it was reported made it look like we owed $12K more. It was sorted out correctly, but I'd officially had enough of the nonsense. I'm generally a DIY type in all other aspects of my life, from the server room to home renovations and fixing my own car -- but this one I gladly farm out. I throw a few hundred bucks at the problem and I don't have to deal with any of it. Our return is also more complex since my wife runs her own business, too -- so I'm just happy to have it taken care of so I can work on other projects and spend time with my kids.

I would really like the US to have a better tax code, but honestly I'm going to be in the grave before that happens.

Filed my first year in Linux (1)

scorp1us (235526) | about 9 months ago | (#46757201)

Not having a "real" platform, I used the web version of TaxACT. It was half the price of TaxCut to TurboTax. Being a web app, it was alright but the interface was buggy, and the questions were awfully worded.

I've been running Mint 115/16 for about 6 months, and other than tax filing it has been fantastic.

Reminder: before switching someone to Linux ask about how they do their taxes first.

Norway (1)

tantrum (261762) | about 9 months ago | (#46757207)

Here in Norway, the company you work for pays your taxes for you based on a personal tax card. The personal tax-card is distributed electronically from the government to every citizen based on last years income.

When we get our tax return forms, all debts, interests, banksavings, stocks and property is already filled out. Most people only have to make small changes.

Everything you need to change in the forms, are available online.

If you own taxes or you've paid too much through the year, the final balace must be cleared by june.

Seems like the system you guys got over the pond is vastly overcomplicated.

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