Tax Prep - TurboTax versus Accountant

[Brillo]

My wife and I paid south of $300.00 to our CPA and have been for many years. I am retired with income from the sale of a business and the usual other income from standard investments. I also have a part time job with with a 1099NE and related expenses. I wonder how much of a cost factor in your current tax bill is related to her buying out and needing to pay a former business owner.

 

[nnmarcher]

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.

I also use freetaxusa.com and I suggest it to people when they ask. It has handled a few unique scenarios of my own.

 

[Crusader]

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.

Not in my experience; I've use HRB for years and it always seems to be cheaper than Turbotax. I got the Deluxe + State (with 5 free fed efiles) version of HRB a couple months ago for $22.50 (download version) from Office Max. Most years can get it for around $30 from one of the vendors, including Walmart and Amazon. Maybe it depends on where/how one shops for the software.

 

[Pony Soldier]

In 94 I took a $10,000 179 deduction on a new pickup. Unknown to me, that triggered an audit. So two years later the auditor came from one place, my forms came from Salt Lake City and we met in Butte. He asked to see my driving logs for mileage, if I had reciepts for my feed costs (which I did) and something else. Since I kept good records and had everything, he smiled at me and said what would you like to know about the IRS. Twenty minutes later I had learned how to consolidate my form and critical factors I should pay attention to. A month later I got a check for $250 for overpayment on my taxes. Cheapest tuition I have ever paid or not.

Keep good records. Your checkbook depends on it.

 

[pipen1993]

I used turbo tax first and verified with a cpa, I should have saved the money from the cost of a cpa and submitted via turbo tax. I would have came out ahead!

 

[twofer]

After using paper forms since forever, I switched to TurboTax about 10 years ago and have been happy with it ever since.

 

[Haggin]

I have used a accountant for several years after using TurboTax. Simple W2s along with a trust, farmland rental income, and a Schedule F for hay sales and steers I feed for friends freezers, my bill is similar to OPs but worth it.

We don't even go in, simply drop all the stuff off, have one call/zoom to cover off on any thing, then its all filed and we sign online. I cut a check to the CPA and move on, they do all the filing/efiling from their office. They even send all my supporting info back neat and organized. I feel my time is worth more that what I pay to tax prep as I think it'd take me a day to do them online.

Its probably more to use the CPA, but I figure I'd rather have somebody sitting beside me in an audit that I know than a TurboTax download code. They probably offer audit support, but again, known vs unknown.

 

[tony]

Used TT few years back. Time I was done, it cost near the price o& the accountant I always used. I usually work a FT and a PT job or two. So nothing crazy.
Now my accountant is charging $200.00, so I plan to use TT again.

 

[ladogg411]

Much of the benefit in doing your own taxes comes from learning how taxes work. You then make better financial decisions in life because you clearly understand the model.

It's a much bigger cost savings (for me) than the price difference between DIY software and a person.

I would stop studying this stupid game tag BS and hire a tag service before I would stop doing my own taxes.

 

[Titan]

You were charged the rate at which they don't mind if you leave and if you don't, it's worth their while. I'm assuming it's been slowly climbing the last few years. They are seeing at what point you don't return.

Based on your info, you have a $200 return unless for some reason you have multiple state filings. If I charged what these other people do, I would only work for 3 weeks and hunt every state!

 

[CaliWoodsman]

Partner in a CPA firm here. Some CPAs criminally undercharge their clients. There’s a shortage of accountants in general and CPAs specifically, so expect fees to keep going up simply due to supply and demand. I tell my clients if they want their fees to go down, their kids need to study accounting in college.

 

[Dos Perros]

My wife (accountant, but not CPA) uses TurboTax. I've lobbied her to just do it herself but she likes TurboTax. I have a budding LLC and have a vehicle I solely use for business purposes and it's a PITA to figure out how to force TurboTax to do the actual expenses + depreciation method vs miles.

TurboTax does save your info from year to year, so the first year you use it is the most difficult, and after that it's pretty easy. It's also nice to make comparisons from year to year to get a feel of if you should pursue pre-tax or post-tax retirement investment strategies.

We paid $248 this year for fed plus two states (I work in a different state than where I live). If you value your time it's a pretty good deal, IMO.

 

[AKBC]

You were charged the rate at which they don't mind if you leave and if you don't, it's worth their while. I'm assuming it's been slowly climbing the last few years. They are seeing at what point you don't return.

Based on your info, you have a $200 return unless for some reason you have multiple state filings. If I charged what these other people do, I would only work for 3 weeks and hunt every state!

Yes, the new accountant I used the last two years is partially retired and only doing taxes for a few people and I think you are right, she wants me to move on. Wish she would have just said so.

Thank you to everyone who replied. I will find a new accountant for next year and see no reason they need to live in Alaska but it would be ideal if they have knowledge of commercial fishing. I will ask around and am open to recommendations via DM.

 

[Deerfield]

I use TurboTax and have wages, schedule C and schedule F. It’s pretty easy. But it does end up costing about the same as having someone do them.

Worst part is still just tracking down a years worth of paperwork and receipts.

 

[MattB]

Yes, the new accountant I used the last two years is partially retired and only doing taxes for a few people and I think you are right, she wants me to move on. Wish she would have just said so.

Thank you to everyone who replied. I will find a new accountant for next year and see no reason they need to live in Alaska but it would be ideal if they have knowledge of commercial fishing. I will ask around and am open to recommendations via DM.

Each state’s tax code is different so there is some benefit to having an in-state CPA.

 

[Rich M]

It all depends on how easy your taxes are. I pay about $900/yr and hev ells me what to do when i have questions.

 

[insanelupus]

I consider my accountant an investment paid toward future time and information. It has always paid off.

 

[Hamartian_]

Will be a pain in the neck to set up initially but I'd say see about TurboTax. 1040s and a Schedule C aren't too bad, the depreciation isn't difficult either once it's set up (keep an excel table once you're sure it's right for each asset).

And if you're still not comfortable move onto a different CPA

 

[Doc Holliday]

You just need to get audited once to fully understand the game.

I interpet this to mean you have been audited. Is it true that they initially send you a statement showing what they think you still owe, and you have a chance to just pay what they are saying and it goes away? Or do they right off the bat turn every rock and stone over and make you go through all your accounts and make you answer for every credit and debit? Whats the general process?

 

[Pony Soldier]

All we got was a letter saying where the audit would take place, the time and to bring our records. This was two years after we mailed the return in and had recieved and spent our refund.

We keep very good records and showed up with all of our support data and the audit lasted about a half hour. About a month or two later they sent us another check.