Sunday, January 6, 2008

Tax Professionals vs Tax Software

Well this isn't a major dilemma. Why would you choose to use a tax professional over tax software. Honestly, I can't see a reason that you should. You may even want to just do your taxes yourself. The directions are relatively straightforward, that is if you have the attention span to stick with them.
TurboTax - Do your Taxes for Free - It's Easy

I personally do not do my own taxes and I am an account. I take my taxes to my aunt who uses TurboTax, and she does them for me. I pay her $30 bucks and I am on my way. I just hate doing taxes. I took two tax classes in college in they were the two most painfully excruciating classes I had to endure. As an accountant I have been ruined when it comes to those classes. It is like being asked to pet the dog who just bit me. Really, the only time you should consider a tax professional is if you earn quite a bit of money, and you have quite a few perks that come with your job. Yes those can be taxable.

For instance, if you are on the Runzheimer plan at your company. Typically, you would be a sales guy. Then if you don't drive a certain amount of miles per year you may have to claim a portion of the cost as taxable income. If you drive over a certain amount of miles namely 30,000 you have a tax asset had the end of the year. In laymen terms you get a deduction.

If you are like most people, and have basic circumstances stay at home purchase the software and just answer the basic questions you are asked. Make sure to answer them honestly, don't think of ways to answer questions that are advantageous. Tax software is also being created to handle more and more complex problems. It is amazing that they are still able to achieve the better results than many of the tax preparers out there. Remember many of the people at H&R Block are making $7.00 an hour. They are just running numbers through a program.

At the end of the day tax software is being used either way. You can run it for your business or do your individual return. Again, unless you have a complicated corporate structure or partnership you don't need a professional. If you are filing a personal return you should be good, possibly even if you are on the Runzheimer. I've never had to deal with this type of situation. Hopefully, throughout my career I can stay away from taxes as much as possible.

These are two tax software options I recommend:

TurboTax - Do your taxes for Free

Free Online Tax preparation Software / E-File

Hit up each site review the features and figure out which software you prefer. Both software really lay out the information in a user friendly way. Besides you do you taxes in your underwear and don't take the shit from some hourly so called tax professional. If you don't need a CPA you can take care of your taxes using these options. In college I used TurboTax to file a return for a corporation including AMT and for a two different types of partnerships. I got an 80% on the partnership returns and a 97% on the corporate return. I kind of did the return for the partnership the day I had class. Fortunately, it was a night class.

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