Tax Prep - TurboTax versus Accountant

[AKBC]

My tax man retired recently and the new accountant charged me $925, almost double what I was used to paying and I'm sore about it.

I have wages and one side business so she completed a 1040, schedule C and Section 179 to depreciate a new piece of equipment. I summarize my income and expenses so she does not have to sort through a shoe box of receipts. I provided all my information to her by early February.

Does anyone have experience using TurboTax or other online tax software for Schedule C self employment income, equipment depreciations, and amortizations? If so, what has been your experience? Do you need to be very knowledgeable of the tax code or will the software guide you adequately?

I am frugal but do not want to be penny wise and dollar foolish when it comes to my taxes. I sleep well at night knowing I don't cheat on my taxes and they were prepared accurately.

 

[MattB]

I am going to be in the same place as you next year as my 20+ year accountant is retiring in July. I am going to give it a go on TurboTax. Same as you, depreciation schedules are the only thing that has me concerned.

 

[PredatorSlayer]

I use H&R block every year and it is super easy. My wife and I’s W2 income and a side hustle.

 

[AKBC]

I use H&R block every year and it is super easy. My wife and I’s W2 income and a side hustle.

Thank you for the reply. Do you have depreciation schedules and if so does it help you determine what is allowed?

 

[Pony Soldier]

I do the taxes on my ranch. It's not that hard once you know what is required and you diligently save every receipt. Depreciation isn't that hard once you set it up. You just have a number of choices and it takes a while to read through all the options.

I consult through an S- corp and an llc. Once my profit drops below a level I will likely drop the corporations. Until then I have yet to inderstand all the forms and rules.

My accountant complains that a lot of his clients are incapable of gathering the proper data to even allow him to file the taxes. You just need to get audited once to fully understand the game.

 

[wyosteve]

I use Turbotax for self-employment and it always asks me about depreciable assets, but I usually don't have any. I've used it for around 6 years and never a problem. Worst you can do is try it, and if you don't think it addresses all your issues, just don't end up filing through them. You don't have to pay for it until the end of the 'program'.

 

[Szwampdonkey]

Turbotax is the way to go.

 

[Winnie]

$925?!? Holy moly. My tax guy sat down with us for an hour and charged us $85. Wife has 2 incomes, I have 2 including some super small farm income that lets me depreciate a few things. All receipts organized.

 

[NRA4LIFE]

Turbotax here as well. 1/2 the cost of H&R Block. Next year I will go it alone though as it is quite easy now. I think I paid about $230 for the TT version I needed.

 

[AKBC]

$925?!? Holy moly. My tax guy sat down with us for an hour and charged us $85. Wife has 2 incomes, I have 2 including some super small farm income that lets me depreciate a few things. All receipts organized.

Your tax guy is a gem.

I never met with her. I mailed her my forms and an organized summary of expenses and income and she sent me one email to clarify a few things. She also sent two 1099's to people who helped me on the boat.

 

[LostArra]

If you keep good records and you aren't laundering drug money then just filling in the blanks is the easy part. How comfortable are you dealing one-on-one with the IRS? Remember that Inflation Reduction Act? About $40 billion to the IRS for "strengthening enforcement activities".

I'm recently retired from 41 years of self employment. Always paid a CPA, still do.
One year I get a letter from the IRS disputing something and telling me I owe so much and a small penalty and interest. Didn't seem like a lot so I called the CPA and asked if I should just pay it and be done.
His reply: "Hell no! Send me the letter. Don't talk to them. I'll deal with it. You aren't paying anything!"

Three weeks later I get another letter from the IRS and all is well. I didn't pay a dime and I never had any interaction with an IRS agent.
I don't know about Turbotax and such. Maybe they go to bat for you too or if you are well versed in tax law then a pro may not be needed. After that one experience, my tax prep bill just never seemed like a big deal. I prefer to bitch about the taxes.

 

[CorbLand]

Never used any of the online services. My brother is a CPA so that’s helpful. One thing that has sold me on using an accountant is that they generally know little things that an online program most likely wouldn’t. One year I used my brother and owed ~800. He started looking into ways to reduce that and found a way. My buddy used an online deal and had to pay ~500. He could have done the same thing my brother had me do and not paid a dime.

 

[flatlanderhuffandpuff]

I spend about $600 and my tax guy has always paid for himself. We used turbotax and H&R block and will not go back.

He also handles my business tax account so it makes sense to have him do my personal taxes as well.

 

[DAOutfitters208]

Does anyone have experience using TurboTax or other online tax software for Schedule C self employment income, equipment depreciations, and amortizations? If so, what has been your experience? Do you need to be very knowledgeable of the tax code or will the software guide you adequately?

The answer to that question is YES.

 

[svivian]

Try to find a better CPA first. Ask around to some other business owners you know and see what they are paying for services.

My guy charges $240 to do my taxes which includes both my wifes and my W-2's, her 1099, My investment accounts, and our rental property. Plus if you refer business to him he reduces your cost for that year greatly. $240 is his normal rate to do our taxes by the way. Obviously yours is a bit more complicated but $900+ sounds ridiculous.

 

[Brendan]

TurboTax is not without the possibility of error, especially as you get into less common cases.

Sold a condo that I'd owned in 2018, that had been used as a combination of Business and Personal over the years. TurboTax led me through a process that ended up being wrong, came out in an audit a couple years later, cost me thousands in penalties plus the fact dealing with an IRS audit is one of the least enjoyable things you'll ever be involved in.

Yes, I was able to verify after the fact that it was actually a TurboTax error but the IRS doesn't give a F who's fault it is, they just want you to pay. Was one of those scenarios where it cost me less to just pay the penalties than try and fight it. For the record, the IRS did disagree with how I accounted for something else that wasn't TurboTax's fault and hit me for that too (which I still think is BS, but not much I can do about it - this was a depreciable asset v. expense issue, a CPA would have either been able to guide me right from the beginning, or probably support the argument better in audit if he would have had me handle it the same way)

Now, that's not to say an accountant couldn't screw up too, but if you have a decent one the chances are better for you and then you also have someone in your court if you do get audited. Right now I'm still using TurboTax. My taxes right now are about as easy as they come and I'm taking the standard deduction, but I'd be a little more wary if they got more complex in the future.

YMMV.

 

[Ownthewest]

Find a good CPA and use them. They may cost several hundred dollars but can save you thousand. You end up paying Uncle Sam more by using the cheap online options.

 

[grfox92]

Yea that sounds excessive.

This year was my first year in business and my bill was $300. Big firm that handles alot of clients. I can't imagine why your new guy was over 900 bills.

Where are you located OP?

Sent from my SM-G990U using Tapatalk

 

[RO1459]

I get free TurboTax through the VA and use it every year to check on my CPA. I've done this for three years now and have found that my CPA saved me money each time. Our tax's are somewhat complicated so we pay $450.00 for his services. This year TurboTax had me paying $306 more than my CPA, so after his charge, I had to pay $144 more overall. But I paid it to a person I like, rather than the IRS, that uses it in ways I don't like. Also, there is less chance of being audited by using a CPA that certifies his work.

Good luck.

 

[Afhunter1]

I’m an accountant (not CPA) but I do prepare audited financial statements and business taxes for the business I work at so I know what I’m doing. I use Freetaxusa.com and find their online platform quite nice. It’s not to hard or to dumb to use. I also have a farm and 2 different rental properties and investment income and it handles it all fine. I recommend it to everyone who asks me for an online tax service.