Doing Taxes Yourself vs. Using Turbo Tax or H&R Block

For a number of years, I did my taxes myself. I sat down with all the wonderful tax forms with such eloquent titles as 1040, 8917, 1099, 8889 … it’s enough to make your head spin. I’m one of the few people that enjoys doing taxes, I don’t like paying them any more than the next guy – but I’m weird in that I enjoy completing all the forms and crunching all the numbers.

Is it really worth doing it yourself?

Three years ago I ran into an issue with my taxes and after repeated attempts at trying to figure it out myself, I ended up on H&R Block’s Tax Center website and filed it there. Rather than reading through 161 pages of instructions… for one form (1040)… H&R Block asked me a series of questions – in English – and determined the best course of action.

I was hesitant at first, I remember the second year I did my taxes through H&R Block and I also did it by hand to see if I could find more deductions or somehow pay less taxes – I couldn’t. Granted, I’m not an accountant, but I knew my way around a tax form.

I had another friend who worked full time in his state of residence and part time in the neighboring state. He could do the federal return on his own, but when it came to filing the state taxes he was lost. On top of the normal taxes he was used to, he would have to complete a non-resident tax return for his part time job – but he didn’t know where to begin. He ended up buying a tax program – TurboTax. I emailed him to see what he thought of it he replied with:

It was easy.

Yeah, I know… Not much of a testimonial, but you’ll notice he didn’t say it was difficult or painful or even tricky, he said it was easy. We both agree that using a program for our personal taxes is much easier, faster and less frustrating than doing it ourselves.

My only word of caution is, if you own your own business and are filing a corporate tax return, you may want a real CPA to prepare your taxes. If you don’t have a CPA, you should get one – they do a lot more than your taxes and can be an asset to your business’ overall future development.

Between January and April of every year I am asked literally hundreds of tax questions – most of which I am not allowed to answer. When I can’t answer their question I have to suggest they speak to their accountant or tax advisor. Now I know that most people don’t have accountants or tax advisors; but if you ask me, speaking from personal experience, I can tell you that using a program is so much easier.

Good luck this tax season, just don’t forget to put some of that return money into your savings account – you’ll thank me later.