One of my father’s yearly rituals as a kid was organizing his income tax paperwork on New Year’s Day. He’d sit at his home office desk, receipts piled high around him, heaps of paper strewn over the floor, and a calculator beside him. This was in the 1970s and 1980s, before computers were commonplace in homes. My father (and mother) owned a restaurant and some rental property in addition to working full-time as a school administration, so their income tax situation was never simple.
As a result, like my father before me, I’ve always prepared my own tax returns. I was in the one-job 1040EZ form camp when I first started filing on my own. This was before the advent of personal computers. I’d go to the post office, get the form, and hand-fill it. My first home computer, a large 17″ monitor with a heavy tower, was purchased in 1994. I used TurboTax to file my taxes that year. This was back when you had to go to a store and buy a package containing a compact disc with software.
My income taxes have been increasingly difficult since 1994. I obtain many W-2s since I work in film and television — typically on various shows per year and in multiple states (my highest per year number was ten). In addition, I have a side business and a lot of 1099 revenue (both non-employee compensation and rents). Itemizing regularly yields a bigger deduction than the standard deduction. All of this is to suggest that my days of filling out a 1040EZ, as well as the EZ form itself, are long gone.
The bulk of my coworkers have a tax advisor that they pay every year, however it can be difficult to locate one who is familiar with how film and television crews are compensated and is available. I occasionally consider hiring a professional, but because you’ll still have to gather and organize all of your receipts, W-2s, and other documents for a tax preparer, why not just enter everything yourself? It’s also possible that I’m lacking in control.
How to use TurboTax to do your own taxes
One of the main reasons I maintain using TurboTax to handle my taxes is that it retains track of all previous years’ information, which can be downloaded and saved as both.tax and.pdf files. All tax laws and rules are (obviously) kept up to date in the program. In many cases, you can provide your W-2 information electronically (if supported by your employer). This year, I discovered a new feature: you can upload a PDF of a 1099 or W2 form and the computer will automatically fill in the information — much better than having to manually type everything in (as in previous years).
The web-based software provides access to assistance files as well as round-the-clock support from experts and other clients. Before you file, the application conducts a check to make sure you’ve filled out all of the required paperwork. TurboTax provides a “guarantee” that all computations are right, as well as audit support if necessary.
For an extra $60, you can add on “audit defense,” which includes identity theft monitoring and restoration. It’s debatable whether you actually require this level of protection. While it certainly provides peace of mind, if you actually did have to go to court over an audit, it doesn’t include legal representation.
If you can complete a simple tax return without itemizing deductions, TurboTax is free.
The $59 deluxe version includes itemizing, the $89 premier version includes rental property income and investments, and the $119 self-employed edition (which I use) includes advice for freelancers and small company owners. Each of these is frequently available on Amazon for a slightly lower price as a download — or even an old-fashioned CD. All of this software is currently on sale at Amazon ahead of tax season.
These fees solely cover the cost of filing your federal form. The cost of each state is $54. For an extra $60, you can upgrade to the “TurboTax Live” edition, which includes on-the-fly counseling and a professional final review. There’s also the option (for even more money) of having someone else do your taxes for you, which is new this year, I believe.
TurboTax isn’t inherently less expensive than going to an accountant or other tax service, but I prefer knowing exactly what I’ve deducted and where I’ve spent my money, as well as knowing that I’ve completed everything myself.
There’s definitely no need to switch if you’ve been using the same tax preparer for years – unless you’re like me and have control issues and like the process. It’s also worth noting that if you don’t want to, you don’t have to use any tax preparation software or hire a professional to complete your taxes. You can go full OG, as my father still does, and do everything the old fashioned way – though I believe my brothers and I ultimately persuaded him that e-filing is more efficient.