

Ask HN: Do you prepare your own taxes? - seanwoods

I'm a single individual with no spouse, children, house or small business.  I'm reticent to use programs like TurboTax because I just don't see what value they add above doing it myself.<p>I could definitely see the advantage of using a program or going to a professional for a small business, but for one person it just doesn't seem that hard.<p>Am I just being naive?
======
nostrademons
I did my own taxes from when I started earning enough money to report it (age
19) to when I moved out of my parents house (age 27), because my dad was
always distrustful of tax programs or advisors. I switched to TurboTax for the
past 2 years.

I've found that TurboTax cut down on the time required to do my taxes from "a
weekend" to "about 3 hours", and saves me roughly $300/year in deductions that
I didn't know I could take. It's been well worth the $50 or so I pay for it.

~~~
seanwoods
What kinds of deductions did TurboTax reveal?

~~~
nostrademons
Things like:

Certain moving expenses are tax deductible if you're moving for work, from a
location that is more than 50 miles away from your new job to a location that
is less than 50 miles away.

Money received from paid family leave is tax-deductible on state taxes in
California, but not on federal taxes. This can be a big chunk, since PFL is
basically a replacement of income for the duration, and having your income be
non-taxed is a pretty big refund.

Charitable contributions are tax-deductible. I think everyone knows this, but
the wording on form 1040 can be somewhat confusing as to when you can take
itemized charitable deductions and when you should take the standard
deduction.

------
gojomo
Your question phrasing is a little odd; I would consider using software
(rather than paid help) as "preparing my own taxes".

TurboTax and similar are barely $30, for federal + state. Plus they're tax-
deductible!

What's the value of your time? They don't need to save that much time to pay
for themselves, much less if they catch an error or opportunity that you would
miss (unless devoting a lot more reading and care to the paper
forms/instructions).

Sure, if you've only got one W-2, no or very simple retirement accounts, no or
very simple deductions, you can probably do without any software. But even
then, I think there are then free online forms to help avoid simple mistakes
or tallying errors.

(In my platonic-ideal digital republic, the tax code and the tax preparation
software would be one and the same, and subject to a capped complexity budget
in kB.)

~~~
nostrademons
"TurboTax and similar are barely $30, for federal + state. Plus they're tax-
deductible!"

I think they're only tax-deductible up to certain income limits or something.
I remember seeing that section, saying "Sweet, I can deduct the cost of
TurboTax on my taxes!", then having it come back with "Sorry, your income is
too high to take the deduction for tax preparation services". Bummer. Why'd it
even ask, since it knew my income before the deduction section?

"(In my platonic-ideal digital republic, the tax code and the tax preparation
software would be one and the same, and subject to a capped complexity budget
in kB.)"

The way we handle taxes is kinda absurd anyway. Almost all the input data we
feed into TurboTax is information that's reported to the government anyway,
and they crunch the numbers too to figure out if you should be audited (ever
noticed that if you make an arithmetic mistake on your taxes, they'll just fix
it for you and deduct the appropriate amount from your refund?) Since the
government is doing the numbers anyway, why can't they just _do_ our taxes for
us, and either send us a bill for the difference or cut us a check for the
refund.

