Tax Day Cometh, and I’m Not Using TurboTax Again

Posted on April 13, 2015


It’s kind of great, but too scary for me

Lila is a big fan of the stubby-pencil method for doing taxes. I download all the necessary forms and instructions from the IRS website, I read the instructions and do my own math (even though math and I don’t get along well). In a good year, the process is a lot like a hellish scavenger hunt or some kind of sadistic puzzle devised by Rube Goldberg. It’s a hassle, it takes up my time, and frankly, I hate it, but at the end of it all I at least can tell where all those numbers really came from, and what factors had the biggest impact on our tax bills.

Well, this year was more complicated than most. A big part of the complication was caused by finally selling my Dad’s old house which my sibling and I inherited a few years ago. I started to put together my 2014 Tax Scavenger Hunt paperwork, but… with a lot of distractions combined with the extra complications, I figured: eh, what would it hurt to pay a professional tax preparer just this one year?

So I gathered up my paperwork, organized and labeled it, and off I went. “I usually do my own taxes with the stubby-pencil method,” I told the tax professional, “but this year there are more moving parts than usual.” I laid out the various nuts and bolts that were beyond our usual tax concerns. “This will be a lot of forms,” she told me. “Considering what you’re telling me, it’s going to be at least $500 to do your taxes.”

After I was done picking my jaw up off the floor, I thanked my friendly neighborhood tax professional for the warning, collected my folders and scurried away. I was feeling overwhelmed enough to be willing to pay something for tax help, but five hundred dollars?? It takes an awful lot to make me that desperate. I went home and steeled myself for a worse-than-usual annual misery-fest.

Back in his single days, Hubby was a fan of Turbo Tax software. What the hell, I thought. Even the Premium version is a lot cheaper than $500 and it will save me a huge amount of time and effort.

And it did! I loved that it calculated my state taxes for me as I did my federal taxes; I loved that I didn’t have to do the actual math; I loved that it saved me from having to calculate such useless things as the Alternative Minimum Tax, a form which robs me of a good ten minutes of my life every year.

However, there was trouble in Paradise. What I did not like about Turbo Tax was that I could not actually see the forms as I worked; in fact, I wasn’t actually working or thinking at all. I was just sailing along like a drooling idiot, answering a series of questions while the program cheerily kept me informed on how much money I was getting in my refund, and even calculated and re-checked everything and reported that there were no errors on my return.

The thing I missed the most was not being able to consult IRS instructions as I went along. I’m guessing that most taxpayers would not even know which instructions applied to the various questions, since Turbo Tax does not show you the forms as you go! It’s all very mysterious until you get to the very end and see the forms printed out, and even then, you may have no idea how some figures came to be.

Certain things were absolutely not intuitive and very nearly got me into trouble. The big one was the very thing that had driven me to try Turbo Tax this year: the sale of Dad’s house. After I entered my basis and the sale price, the program cheerily informed me that I had a loss of tens of thousands of dollars on that sale. My tax refund shot up as a result. Woo hoo! Yay, Turbo Tax! Um… small problem, we are actually not allowed to claim that loss, and the only way I knew that was by previously reading the IRS rules on the subject. I went back in to Turbo Tax and tried to force a zero loss to appear on the house sale; no dice. I used the help feature to try to figure it out; only after trying two or three helpful hints did I figure out which menus to follow to get the correct result, and even then, the figures would not appear correctly until I deleted that whole section and started over.

In the end, after some wailing and gnashing of teeth, I finally printed out my finished Turbo Tax forms and lo and behold, it’s a real, honest-to-goodness return with all the right forms. I have to admit, it was a lot faster and less painful than the stubby-pencil method.

Still, I won’t be using Turbo Tax again. I’m not smart enough to stay out of trouble with a program like this; the fact that it very nearly made a tens-of-thousands of dollars error on my return while blithely telling me everything was hunky-dory is enough to make me break out in a cold sweat. I wonder how many unsuspecting taxpayers just sail along, answering the Turbo Tax questions with full confidence, all the while missing out on the more obscure tax breaks or – worse – making mistakes at the IRS’s expense.

I hear the IRS does not take kindly to that…