For years, I used to go to a fancy accountant to get my taxes done. It cost me around $750, and I always wound up owing at least $1,000 in the end. Very annoying.
Last year, I decided to go see someone cheaper, a “tax preparer” who had an office in an old Midtown building and a frosted-glass door with his name on it. Visiting him was like stepping back in time to 1952. He charged me $350 and I got a $350 refund, so I was even.
This year, my time-traveling C.P.A. went A.W.O.L. — no responses to e-mails, no returned phone calls, zilch. With Tax Day approaching, I figured I’d try to do it on my own. A money-savvy friend of mine spoke glowingly about Intuit’s TurboTax app for the iPad, so I gave that a shot.
Long story short — it was a dream. The app is basically a giant questionnaire, in which you answer hundreds of questions about your financial state of affairs. I had all the necessary paperwork (well, almost — tracking down the Social Security number of my 1-year-old son took about 30 minutes): W-2s, property-tax statement, mortgage interest statement and a 1099 for some non-retirement investments.
The TurboTax app is well designed and well written. It dispenses with jargon and uses plain English. For example, sometimes you are asked a question that sounds odd; the app will point out that this kind of situation is uncommon, reassuring you that it may not apply to you. Filing, payments and refunds can all be handled electronically — which is nice because not only does it cut down on paper, you get your money (if you’re getting a refund) faster.
As I worked through the app, I realized that it seemed eerily familiar. Not because I had ever used TurboTax before, but because my off-brand tax guy seemed to ask me almost the exact same questions last year. For all I know, he was reading off a TurboTax transcript. If you have a complicated financial picture, by all means go to a top-notch accountant and sort things out with a pro, but if your situation is pretty straightforward, take the two or so hours it takes to work through TurboTax’s app and save your money.
Not that you’ll save all your money. While the app itself is free, you do have to pay TurboTax to electronically file your federal and state returns (federal returns cost $50, state returns cost $40). I’d call this a bait-and-switch except for one thing: You can work through the entire app and see what you will owe or will be getting back before spending a dime. My thinking was that, if this app did as well or better than my old accountant, I’d go with the app. Filing my taxes through TurboTax would cost $130 (I live in one state and work in another, so I have two state returns), so my refund had to be greater than $130 for me to go with TurboTax. As it turned out, TurboTax calculated that I should net more than $2,000 in refunds, making my decision very easy.
If you have an Android tablet running Honeycomb or Ice Cream Sandwich, TurboTax has an even better deal: free filing of your federal and state returns if you start using its app by Sunday, April 1. You don’t have to finish then, just get the process going sometime this weekend and you’ll have until April 15 to take advantage of the free offer. IPad users will still have to pay full freight, unfortunately. In this case, the dreaded “Apple tax” has returned.