TurboTax is a popular tax software with the do-it-yourself tax preparation crowd. I’ve used it myself for the past three years, and I’ve been impressed with how easy it is to file my taxes with TurboTax.
Recently TurboTax provided me with a coupon code to review TurboTax Premier.
TurboTax Options
TurboTax offers five different tax filing options online.
Free Edition. The free edition is for those with a very basic return. If you have a regular job with a W-2 form, a basic savings account, and don’t have any complicated stock transactions, this is the option for you! Federal e-filing is free, but state e-filing will cost you $27.95.
Deluxe. If you have a fairly basic return, but itemize your deductions, the Deluxe edition is probably your best choice. It costs $29.95 for federal e-filing, and state costs an additional $36.95.
Premier. Best for someone with complicated stock transactions or rental property income, TurboTax Premier will cost you $49.95 for federal e-filing. Again, state filing is $36.95.
Home & Business. This is the best option for home based business owners, like me. Designed for those who own their own businesses, this option will run you $74.95. State filing is $36.95
Business. If you have more complicated business transactions, such as when you own a corporation or are part of a partnership, the Business option is the best. It costs $129.95 for federal e-filing, with state filing being $49.95
Preparing Your Taxes With TurboTax
Preparing your taxes with TurboTax is fairly straightforward. If you have used a paid version of TurboTax before, and you use a paid version this year, TurboTax will automatically enter your basic information from last year.
In my case, the basic information from my husband’s W-2s and my 1099s were already entered. TurboTax asked me if we had W-2s and 1099s from the same companies this year. Some of the information had changed. I checked the boxes of the itmes we didn’t need on our return and easily deleted the information.
Entering W-2 information was easy, since the basic information had been imported from last year’s return. I just had to enter the wage and tax information, and I was ready to move on.
I began entering information in the Deluxe version of TurboTax, knowing full well that I’d be upgrading to a higher version. Sure enough, when I told TurboTax that I was self employed, TurboTax suggested I upgrade. The software gave me the option to upgrade right then or continue with the Deluxe software. So if you’re not sure which software to start with, choose the least expensive and work your way up.
TurboTax is pretty thorough about asking questions to make sure you take advantage of every deduction you can take. I worked all the way through the form without any major moments of confusion.
Both your federal and state refund amounts (or tax to pay) are shown at the top of your screen, so you know where you stand as you enter your information. It’s great, if you’re getting a refund. It’s kind of stressful to see your tax to pay number grow, though. However, the refund/tax to pay information is important, so I’m glad it’s easy to see, even if I don’t like the number.
As you’re working through the form, if you have a question, there is usually a “More Info” link that will give you more information about a given subject. And as you start each section of the form, there is a link you can click to find out what paperwork you need to gather, before you fill out the form. This is incredibly useful if you are not doing your taxes in one sitting.
Also, as you enter your information and progress from section to section, TurboTax tells you what percentage of your return you’ve completed. It’s nice to know when you’re almost done inputting information.
And finally, I love the flag feature! As you’re working through TurboTax, if you realize you don’t have the information you need at that moment, you can flag that section, so you remember to come back to it later. Just hit the “Flags” button on the top right, choose to add a flag, give your flag a title and write a note, if you need to. You can come back to that section later, and your note will remind you of anything you need to remember.
TurboTax Guarantees and Audit Support
Maximum Refund Guarantee. If you find you get a bigger refund by using another tax preparation software, TurboTax will refund the money you paid to use TurboTax. People who use the free edition are entitled to $14.95 back, plus the cost of state fees, if applicable.
100% Accurate Calculations Guarantee. If you have to pay an IRS or state penalty, because of a TurboTax calculation error, TurboTax will pay the penalty and the interest.
Audit Support. Every TurboTax product comes with a downloadable Audit Support Center. The Audit Support Center explains what different types of IRS letters may mean, so you can decide what to do next.
Audit Defense. Audit Defense is available for an extra fee of $39.95 for individual tax filers. If you are audited, Tax Resources, Inc. will provide someone (not a lawyer) to represent you in communications to the IRS from the moment you receive notice of the audit to the completion of the audit. In order to use Audit Defense, you have to file your taxes on time, through TurboTax, and you have to purchase the Audit Defense membership before you receive notice of an audit.
My Opinion of TurboTax
My requirements for a good tax software are that it be:
- Clear
- Thorough
- Guaranteed
TurboTax definitely lives up to all three. Like I said before, I’ve used TurboTax for the last three years, and I’ve been very happy.
Compared to the other main tax software player,
H&R Block At Home,
TurboTax is competitively priced for federal e-filing. In fact, for federal e-filing, the most common options of both programs (Deluxe & Premier/Premium) are priced identically. The difference in price for the most common software is found in the state filing fee. TurboTax charges $27.95 to file state taxes, if you use their free edition. If you use Deluxe, Premier, or Home & Business, you will pay $36.95. H&R Block At Home charges $29.95 to file state taxes, regardless of which level of software you choose.
Where the big difference between the two programs lies is in the software geared toward owners of small businesses, like me. TurboTax Home & Business is less expensive, at $74.95, but includes less support than H&R Block’s Best of Both at $99.95. Taking into account the price for filing state taxes, the difference comes down to less than $20. At that point, it’s a matter of preference. Extra support or $20? Your answer will depend on how confident you feel filing your own taxes.
Note: Brian, one of my readers, has graciously pointed out that if you shop around at local retail stores or on Amazon.com, you can find TurboTax for less than the price on the TurboTax website.
Source : http://beingfrugal.net
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