How will you prepare your taxes this year?

We're having an individual tax consultant do them. In the past we've used Turbo Tax software and did our taxes online, but last year (Jan) we purchased a home and with all the deductions (property taxes, mortgage interest, etc), and all the additional witholdings I've done on my part, as well as some business write-offs DH has accumulated, we don't want to accidentally mess anything up and come out with incorrect numbers as a result.

My father in law has referred us to his tax lady, so my husband has contacted her to set up an appointment to come in and meet with her in order to get our taxes done, the sooner the better. If we didn't have a local referral for a tax person, we'd probably got o H&R Block or another similarly reputable institution.

 

Maybe you could try to do it yourself first, then you can find out exactly what you would have missed. I think that could be helpful if you try to do it on your own next year. In case you have to amoritize your points or anything.

 

We have a lot of stuff going on, so as usual, we're going to have iur CPA do it. Besides, I'd rather pay someone else to do this.

 

our taxes, though annoying to fill out, are still simple enough that i do them myself.

it's just a pain filling out 2 state tax returns, and all that associated maintenance-of-home-state-residency crap. :angry:

 

We use Tax Cut software. Our return is not that complex and I like the way you can, ahem, 'play' with the numbers. B)

For a few years we used a tax preparer, until the time she 'missed' one of our mortgage deductions (we had moved). I could see that this person wasn't doing much more than entering our data into *her* tax software so I decided to cut out the middleman.

Oh, and we always have to pay. Both of us claim 0 deductions on our W-4's, have the mortgage and kid and we always owe. I hear others talk about tax refunds and it's like science fiction to me.

 

we just switched over to "married but withhold at single rate" for 06.

we owe federal this year, but will get a wimpy refund from state. and we don't even make that much money! sigh <_<

 

I think I'm qualified to give a little advice here. When I retired from my engineering profession, I thought tax preparation might be a good seasonal income booster. So I took the H & R Block intensive course for tex preparers. I can aver that their people are well trained and backed by strong supporting resources. Before the season got underway, however, I was called back by my employer to work as a consultant, so never really practiced the tax art.

Since then I have varied between self preparation and using TurboTax for my taxes and my two daughters'.

Last year I hit a snag: Attempted to file estate income tax as executor of my Dad's estate. He had a bond fund that generated a capital gain resulting in lots of complexity beyond my training. (K-1 forms to be issued to beneficiaries, etc.) Tried to take the problem to H & R, but it was off season and all their local offices were closed. So I found a local "tax lady" who charged a lot but managed to get everything done.

But she made one "fatal" error: forgot to show the fiscal year for the estate starting on the date of death. Result: The dummies at IRS processed it as a late return for the year printed on the form and sent me a bill for $800 in penalties and interest. It took me a year of faxes, letters, phone calls to get it straightened out.

Moral: Stick with H & R Block. If forced to use a "Tax Lady" check her qualifications and check her work carefully. And if you do get into an IRS screw-up, don't panic. If you know you're right, show patience and determination.

 

We should try switching as well. I have to say, I lack enthusiasm for making my paycheck even smaller. As it is, they boosted our health care contribution on the first of the year.

I don't know where we'll stand this year. I know it won't be good so I usually wait until April to look into it.

Thanks for the tip, though.

 

I USED to do it with software... I've recently switched back to the "manual" method simply because I like to "see what's going on" so to speak, follow the calculations, and just "see" how it flows on down.

It's good to revisit the actual 1040 book to keep a fresh perspective of what's going on "overall"...

 

I just wanted to throw in that H&R Block is only good for relatively "plain vanilla" situations. Once a certain level of complexity is reached, or you require some form of optimizations, they tend to fall apart. At least, that's been my experience with them, as I've caught errors, or exclusion, of information on tax returns for various family members, more than once, totalling maybe, overall $700... Then again, I'm biased because my job requires me to be inherently familiar with the tax code, such that I can usually see things, exploit things, that can easily go undetected...

I guess what I'm saying is they're ok, and will do you well if you just don't want to deal with doing it yourself. It's sort of like taking your Prius to Jiffy Lube for an oil change as opposed to one of the more comprehensive interval services at the Toyota dealer... Either way you'll be ok, but the Toyota dealership might go a little further and detail your interior for you... that sort of thing...

 

We tried that a few times this week after we received our annual mortgage statements and W2s. Each time we came up with a different number. Sometimes we owed (different amounts) and sometimes we had $ coming to us. I have NO idea what happened, but I'll assume a pro tax person would be better at doing our taxes than we are. And we don't have any points to amortize.

 

Husband and I are with Rancid, decided to use an independent accountant. Used to do our own, using commercially available software. Then we made a mistake and got into a nasty tussel with the IRS.

Chose our "tax lady" after a meeting and interview. She seems to know her stuff, was quick to research and then respond to our questions. Knowing where to find answers is expertise we're willing to pay for. She advised us to donate a minimum of $7K this past year. Gathered our 2005 papers last night and made some calculations, just missed making the total.

Are you lumping Accountants, Financial Planners/Certified Financial Counsultants, and Stock Brokers together in "Financial Consultant"? There are differences.

Avoid persons who try to sell you stocks, handle your insurance needs, and do financial planning for you. They tend to be crooks, pushing particular stocks so they can gather commissions. Check them out throughly, find out how they get paid.

We use two stock brokers, who buy and sell on our orders, give occasional advice when asked for it. One offers couple other services like long term care insurance (didn't take it, not in the gambling mood that day). The financial consultant (we recently dropped ours and would like to find a replacement) should only be paid for his/her time (between $125-300/hour, meeting once or twice each year). Accountant deals with numbers and taxes. Insurance agent covers our cars, home, boat, posessions, all lumped under a rider with $1M liability. Saved gobs of money by using a rider. Lawyer has become a friend. He drew up Dan's side of the pre-nupt, wills, living wills, trust fund for Dan's parents and niece.

We enjoy keeping as much of our money out of Uncle Sam's (and the banks') hands as we can. No mortages or loans, all cards paid each month, we shop in and make donations to, the local community. We live in easy walking distance of town. Most clothing comes from the dry goods store, seasonal produce from the farmer's market, buy most of our wines at a winery 40 minutes drive away, spend half our vacation time sailing the Chesapeake.

 

I agree, for taxes, it's best to use someone who ONLY does taxes. It's also advisable to get one by reputation/word of mouth rather than the phone book. That's what we did an we've been very happy. You should also find out how they tend to prepare the taxes. Some use a more conservative approach, and others are more aggressive in their hunt for refunds. Keep that in mind, as the more aggressive ones are often the ones with more audits. I prefer a more conservative approach to my taxes, and that's exactly what we get.

We claim ZERO deductions during the year, and all the money is taken out all along. Yes, I know it's like giving the government an interest free loan, but we do get a sizable return every year. Last years was just over $11,000. This years will be even higher, becuase of all the mortgage interest and such. So instead of seeing it as a free loan to the government, I just see it as a nice refund. Also, it keeps us from spending the money, and the whole tax return jsut goes straight into savings.

 

With all the credit card offers I get, I realize they are making way too much money. It seems free to use a credit card, but really it's making the merchants have to raise their prices. Is it 3% of every credit card purchase that goes to the credit card company? Do your merchants a favor, it's like an extra tip, pay cash.

As far as Uncle Sam goes, maybe it'll help pay off the $60k-$70k? of national debt per person if you pay a bit too much.


Edit: Okay, hopefully not really a whole extra tip, but something anyway.

 

2005 will be my 13th tax year with TurboTax. Gotta love electronic filing. I couldn't go back to doing it by hand.

 

I have a company in Huntsville TX that does ours. We've been using them for about 13 years or so.


~Shawn

 

I would like to respond to some of the posts here.

First, I am an ex Block employee. I left Block 2 years ago (that's a long story that I really don't want to go into) and now work for a small independent firm. I have prepared taxes for 11 years. This will be my 12th year. Tax code is a complacated mess. Anyone who doesn't have to do research from time to time isn't working in your, the taxpayer's, best interest.

When you are considering have your taxes prepared by a third party, word of mouth is one the best ways to find a preparer. Even though I've said it here before, CPA's don't always know much about income taxes. Ask questions, such as:

How long have you been preparing taxes?
About how many returns do you do a year?
Will you help me if the IRS sends me a letter?
What happens if you make a mistake and I owe money?
Can you electronically file my return and how much will you charge me to do so?
Are you experienced doing returns for people in my profession? (Truck drivers, day care providers, farmers, etc. have some unique issues that need to be addressed)
What are your tax prep fees?



I am sure there are other questions that you could ask, but these hit the high points.

The national chains such as Block, Liberty, Jackson Hewitt, and the local chains have very competant people preparing taxes. Unfortunately, they also all have people who are in their first or second year of preparing taxes.

If you get a letter from the IRS or state, don't panic. An awful lot of those letters simply want a copy of something. Some of them are wrong. Personally, I love to tell the IRS they are wrong. And it makes my clients happy to go up against the IRS and win.

There are some excellent tax preparers out there, you just have to find them. Please, even though I no longer work there, don't assume that just because you had one bad experience with a company, that all the preparers there are bad.

Good luck on your taxes however you choose to do them.

Joan

 

Both work full time and get W-2's
Each have a different "self employed" position part time w/mileage and expenses and get 1099's
I have a small investment as a shareholder/part owner of a business and get k-1's

Federal, State, 2 City, School district

I don't need the headaches....I use a tax preparer (individual consultant)

 

I used www.taxslayer.com. Filed it on the morning of the 20th of January, got it approcved by the IRS the same day, should have my refund by the 28th. I love beating the rush!