Tim Gray for the New York Times writes: The makers of the better-known tax prep programs — TurboTax, H&R Block at Home and TaxAct — say that many customers, particularly younger ones, prefer Web-based programs to old-fashioned, desktop versions. Web-based programs — techies call this cloud computing — reside on remote servers that customers access via their browsers. They offer the convenience of working on a return from any Internet-connected computer and having that return stored on the software makers’ secure servers.
After spending several days running my family’s tax information through Web and desktop offerings, I learned that I’m old-school. For a decade, I’ve completed our return on my Mac desktop, and I prefer that. Desktop programs may be costlier and, in some ways, clunkier — you must buy them on CD or download them — but they also offer more flexibility.
A single purchase, for example, lets you prepare and file multiple returns, as you might want to do if you’re part of a same-sex couple or if you help family members or friends with their taxes. And you can more easily jump back and forth between the tax return and the interviews the programs use to gather information. That lets you check entries as you make them, as my wife, a C.P.A., insists upon. What you lose in convenience, you gain in control.
Each of the tax preparation programs, whether desktop or online, has strengths and shortcomings. TurboTax is the easiest to use, importing lots of financial information with just a few clicks. H&R Block promises the most reassuring help — its staff will represent you at no extra charge if you’re audited. TaxAct offers the best price. A look at each provider’s offerings shows where it excelled and stumbled in preparing my family’s 2012 return.
TurboTax
TurboTax’s maker, Intuit, has its roots in technology, not taxes, and its facility with bits and bytes shows in its wares. Its desktop and online programs make doing taxes as simple as such a time-eating task can be. If you end up cursing come tax time, the target will be the I.R.S., not your software.
I downloaded the desktop version of TurboTax Premier for $89.99 — though I learned later that I could have paid $10 less if I’d bought it on CD at my local Staples. The download took only a few seconds, as did the import of information from our 2011 return. All of the unchanged data from 2011 — names, addresses, federal ID numbers, even descriptions of business expenses — popped into the right places on the 2012 forms. Even the names of the charities we support carried over. The software also imported my wife’s W-2 and all of the information on our investments from Vanguard, T. Rowe Price and Fidelity. All I had to do was key in details for a few local banks and update the amounts we’d given to charity.
The online version of TurboTax, by contrast, didn’t import as much. My attempt to transfer our 2011 return failed, and an import from one of the fund companies went awry. I inherited an I.R.A., and the money is invested in about a half-dozen funds. Instead of creating an entry for a single 1099-R, the program created a half-dozen, which I had to combine.
Otherwise, the online program looked and worked much the same way as the desktop software. I didn’t have to pay to try it because TurboTax, like H&R Block and TaxAct, doesn’t require online users to pay until they file their returns. Had I filed with the online version of TurboTax Premier, I would have paid $49.99 for a single federal return — the price as it was discounted at the time. But TurboTax says it could rise to as much as $74.99, its list price, before April 15.
TurboTax upgraded its assistance features for this year’s tax filing season — a welcome improvement. In the past, I’d found some help links hard to locate and navigate. When I wanted to pose a question to a tax expert, I had to dig around. But not anymore. When I had a question about recording tax-exempt interest, I clicked on the help link, and TurboTax offered a choice between a call and an online chat. Within seconds, I was e-chatting with Marilyn G., and she pointed me to the right spot on the return. We were done in less than five minutes, and I paid nothing extra. I’ve had a tougher time buying jeans online. (All three companies also provide extensive tax-law explanations embedded in their programs.)
Where TurboTax irks is with its pitching of additional products and services. The online program asked if I wanted to set up an I.R.A. via Mint.com, an Intuit personal finance Web site. It encouraged me to contribute to a charity, Operation Homefront, that TurboTax supports. Both the online and desktop programs tried to sell me, for $39.95, the audit defense services of a company called TaxResources. And they both urged me to pay $10 to upgrade to TurboTax Home & Business.
Yes, businesses have to market themselves and grow, but this kind of promotion grates when you’re pondering the big bill you owe the I.R.S.
H&R Block at Home
In past years, I’ve liked H&R Block’s desktop software. It didn’t import quite as much information as TurboTax did, and occasionally didn’t provide some obscure piece of tax guidance that I could find in TurboTax. But I enjoyed its eye-pleasing, easy-to-use interface and concluded that, for most people, it could do a fine job. This year, I had problems installing it.
I tried to download the desktop version from Block’s Web site and failed — four times. I kept trying to remove any obstacles at my end. I quit my browser, Safari, and restarted. I turned off my pop-up blocker and my antivirus software. I rebooted my Mac. Nothing helped. Stymied, I trundled over to Staples, where I bought Block’s Premium software on CD for $59.99. After that 30-minute detour, I popped in the CD and set about installing the software and the latest updates. During the update installation, the program quit. I restarted. Finally, it worked.
Were the glitches my fault? Maybe. I’m no techie; my nephew who is about to turn 11 can do more with my iPhone than I can. But I was working with the same Mac and antivirus program as last year, and if any software should be idiot-proof, it’s a tax preparation program. Lots of nontechies use software to do their taxes.
After installation, Block’s desktop program was fine. As in years past, it didn’t import as much information as TurboTax, but it otherwise handled our return without problems. And I love the lime green of its interface, which calls to mind Kermit the Frog.
Block’s online offering operated just as smoothly. And because it didn’t have to be installed, it spared me a spike in blood pressure. Had I used it to file, I would have paid $49.95 for a federal return.
Block’s assistance also impresses. If you use its software to file your return, the company promises that one of its tax experts will represent you, free, if you’re audited. The chances of needing this help are slim — the I.R.S. audits less than 1 percent of individual returns, according to statistics it publishes. But even the idea of an audit brings angst, and that guarantee reassures.
TaxAct
TaxAct’s selling point is price. The desktop version of its Ultimate Bundle, which includes electronic filing of a federal and a state return, costs $21.95. TaxAct doesn’t sell a desktop version for the Mac, so in years past I had to load the software onto my wife’s PC and work on our return there. This year, I opted to try the online offering instead. I plowed through our return without difficulty, though I did have to type in more of our information because TaxAct imported less than TurboTax and Block did.
In addition to being inexpensive, TaxAct is quirky. Its maker, 2nd Story Software in Cedar Rapids, Iowa, does some things differently than its competitors. Its interview questions come in a different order, and some of them address surprising topics.
Only TaxAct, for example, asked me whether I had a conscientious objection to Social Security and had filed Form 4029 documenting it. Members of some religious denominations can be exempt from Social Security taxes, as long as they promise not to take benefits.
I didn’t need to know this, but it was a fascinating tidbit to learn — and I’m a fan of anything that relieves tedium at tax time.
0 comments:
Post a Comment