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Jewish World Review Jan. 7, 2011 / 2 Shevat, 5771 Online, handheld tax prep may be more taxing this (new) year By Mark Kellner
http://www.JewishWorldReview.com |
What was one of the great technology marriages of the past 25 years - the merging of personal computing and personal tax return preparation - may show some signs of fraying this new year.
The December 23, 2010 announcement by the Internal Revenue Service that "taxpayers who itemize deductions on Form 1040 Schedule A will need to wait until mid- to late February [2011] to file" brought little joy to the estimated 50 million taxpayers who do itemize. Moreover, those hoping to claim three types of tax deductions reinstated by the late-2010 tax bill, which the IRS labeled as a "state and local sales tax deduction, [a] higher education tuition and fees deduction and [an] educator expenses deduction," would also have to wait six weeks longer than usual to begin filing returns.
For some of us, this writer included, the extra six weeks will offer additional time to check and re-check everything, to make sure every "i" is dotted and every "t" is crossed. That's not a bad thing, per se, even if many of us were itching to pull the filing trigger sooner, in order to get the money we effectively "loaned" Uncle Sam back into our bank accounts faster.
More potentially frustrating, however, will be negotiating the maze of tax-related applications, boxed software and online services, as well as "refund calculators" available free for your handheld phone or via a computer link on your Internet-connected desktop or notebook computer.
It pains me a bit to warn folks away from the TurboTax iPhone refund calculator app, since it's free, seemingly well done, and not difficult to use. That said, unless your tax situation is about as "plain vanilla" as they come, don't expect to find anything resembling a decent guess at your refund.
Yes, you can enter your salary, federal and state withholding and mortgage interest deductions, as well as donations to charity. But did you pay a big legal or tax prep bill this year? Did you move? Do you have a home office deduction? Don't expect to find any of these options in the handheld app. And, therefore, don't expect to get a reliable estimate of, well, your refund.
Online, the TurboTax estimating situation isn't much better. You don't have the user-specific options I mentioned above there, either. H&R Block's online tax refund calculator is a bit better, but it's still a rather confusing process, and lacks as many deduction "inputs" as I'd like to see. (Ironically, TaxAct.com, which Block purchased last year, doesn't have a refund calculator at their site, but rather wants you to begin filling in an online return in order to estimate your refund.)
To me, what's painful about this is that none of these problems should exist, technologically. If TurboTax can come up with boxed and online programs for filers from simple to complex, its handheld refund estimating application and, most especially, its Website, should oblige with similar options. Ditto for Block and TaxAct.com.
Last year's winner (in my view) for online tax preparation, CompleteTax.com, is back this year with a new site and new pricing (including free return prep if you owe money, the firm figuring you shouldn't pay to find that out). But I didn't find a refund calculator there, which I'd like to see.
Subject to the cooperation of TurboTax, which is part of Intuit, and H&R Block, I'll compare these firms' full online preparation services with CompleteTax.com and will let you know which one delivered the highest, verifiable refund.
Meanwhile, the idea of either a national sales tax (FairTax) or a flat tax rate, is rather appealing. In the case of the latter, as proponent Steve Forbes once said, you could fill out your return "on the back of a post card." That would be a blessing for taxpayers, I believe, and allow all those software programmers to do something important, like develop the next killer Facebook application.
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JWR contributor Mark Kellner has reported on technology for industry newspapers and magazines since 1983, and has been the computer columnist for The Washington Times since 1991.Comment by clicking here. © 2009, News World Communications, Inc. Reprinted with permission of The Washington Times. Visit the paper at http://www.washingtontimes.com |
Arnold Ahlert | |||||||||||
