Should I do my own taxes? | FerrariChat

Should I do my own taxes?

Discussion in 'Other Off Topic Forum' started by milstanselnino, Feb 17, 2004.

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  1. milstanselnino

    milstanselnino Formula Junior

    Jan 8, 2004
    Full Name:
    Jon P.
    There must be some tax expert out there who can advise me. Should I do my own taxes? I haven't for the lase several years because of some other business income, and the sale of that business. Now, it seems fairly straightforward: my income, my wife's, some investments, and a couplo kids . I guess my biggest concern is addressing the investment income. Don't you have to show the basis for the stocks you sold, and pay tax on the gain? How about losses?

    Been through an audit; don't want to do that again (I was right, by the way)

    Any help??
  2. TSMIV

    TSMIV Formula Junior

    Jan 27, 2004
    Columbus, MS
    Full Name:
    Robert Goodman
    I am a "tax professional"... I guess. I took a one semester course on tax preparation one year at college and it paid the bills. So, in theory, I qualified to give professional tax advice. Though I would not pay myself for that advice

    Since it has been a while since I professionally prepared taxes I cannot answer your specific questions about investments.

    What can say is this, if it is as straightforward as you think it is going to be then do them yourself. I got paid, rather the firm I worked for got paid, handsomely for tax returns similar to what you are talking about. Tax returns are generally pretty easy to do.

    I would wait to see what Dr. Tax says, you may even want to PM him.

    If all else fails call the IRS... repeatedly. Seriously, call the IRS and ask your questions. And keep calling until you either get an answer you like or you keep getting the same answer you do not like.
  3. formula1joe

    formula1joe Formula Junior

    Nov 3, 2003
    Atlanta, GA
    Full Name:
    Joe Bennett
    So are we against using TurboTax? I have heard good and bad things about this software. I know it will keep me out of someone's office, sorry, but is it effective in saving me money? (that might be a loaded question)
  4. Texas Forever

    Texas Forever Seven Time F1 World Champ
    BANNED Rossa Subscribed

    Apr 28, 2003
    Yes to number 1.

    Gains and losses from selling stock go on Schedule D. And yes, this is a royal pain unless you set up your brokerage account correct from the getgo.

    I use professional software (Lacerte) that really isn't all that expensive. I think that $500 will get you were you need to be.

    From what I have heard, Turbo Tax works well, but I have never used it.

    Actually preparing tax returns is not where I make my money. Perhaps this little story will help explain --

    Once upon a time, a Doctor saved a man’s life on the operating table. Afterwards, the Patient gave the Doc all kinds of love, “You da man. You are the best. Whatever you want, all you have had to do is ask.”

    But when the Patient later got a $5,000 bill from the Doctor, he went Postal, “No way, Jose. I was only on the table for less than one hour. Geeze, nobody is worth $5,000 a hour. I want a detail accounting.”

    The following week, the former Patient received a thick envelope from the Doctor in the mail. When he opened it, page after page after page of detailed billings spilled out. There were item-by-item listings for things like needles, thread, gloves, and so forth and so on.

    The subtotal of all this detail came to $100.00.

    The last page of the bill contained only one line item. There in bold print was the following:

    Knowing where to cut..................................$4,900.00
  5. racedecknc

    racedecknc Karting

    Nov 24, 2003
    Winston Salem
    Full Name:
    I've been through my fair share of IRS nightmares. I equate doing my own taxes the same as performing brain surgery on myself. No Friggin Way!

    Its much better when someone with CPA signs the return anyway, the IRS will ask them the tough questions (if there are any) first.

  6. Dom

    Dom F1 Veteran
    Owner Rossa Subscribed

    Nov 5, 2002
    I use Taxcut by Kiplinger. Similar to turbotax. My father in law is a (corporate) accountant, and I usually send him my return to double check. I haven't had any problems yet, and my father in law confirms that I am not making any horrible mistakes.

    Taxcut is pretty easy to use, asks you tons of questions, and you supply the answers. Then it puts it all together in your return.

    My returns are usually pretty simple. My income, plus my wifes freelance editing income (home office deduction, yippee!!!). Investments can be a hassle when you sell, but I am primarily a buy and hold kind of guy so I don't have too many sales. Since my wife is self employed, it adds some complexity to our return, but it isn't really too bad if you keep adequate records. Also, when you go to an accountant, they will ask you the same questions anyway...

    I had thought about going to an accountant, but as a planner (i.e., this is what you need to do next year to help cut on taxes). The guy I spoke to, unfortunately, didn't seem all that interested in doing that, and only wanted to do my return, and charge me $300 for it. He sent me a huge questionaire to fill out prior to doing my taxes, and I realized that by the time I had filled out his questionaire, I had all of the info for my taxes. Just enter it right into taxcut and tada... you're done.

  7. ernie

    ernie Two Time F1 World Champ
    Lifetime Rossa Owner

    Nov 19, 2001
    Full Name:
    The Bad Guy
    Since my senior year in high school, I have always done my own taxes. Even if I went to a place like H&R Block for a "rapid refund", I already had my taxes done. One time I walked out of an office because the numbnuts guy that was helping me got the wrong figures. That was the last time I ever used H&R Block. Anyway, It would take me about a half day to get them done. I use to do them by hand and then recheck them a few times. It is really not that hard. You can get a copy of the new tax rules FREE. It is called Publication 15, or Pub.15 for short. It has everything that you need to know in it. It tells you about what deductions you can, and cannot take, and the different situations for each deduction. The last couple of years I have been using Turbo Tax. I still did my return's by hand referancing the Pub.15, then used the Turbo Tax. Well the figures I came to were the same as the Turbo Tax, both years. They have a version of Turbo Tax for business owners. Get a Pub.15 and Turbo Tax, and most of all TAKE YOUR TIME. Again TAKE YOUR TIME. Also if you take a deduction, make sure that you have the paper work to go with it. Oh yeah about the "rapid refund". DO NOT ever get one. I looked at my refund paper work the last time that I used Block, and that "rapid refund" is nothing but a super high interest loan. If I remember correctly it was something like 136%. YES I typed that correctly 136%. So, if something goes wrong with your return and they don't get your money from the government, you have to pay them back the amount of the return plus 136%. So NEVER get a "rapid refund".
  8. milstanselnino

    milstanselnino Formula Junior

    Jan 8, 2004
    Full Name:
    Jon P.
    Thanks! The advice is appreciated
  9. formula1joe

    formula1joe Formula Junior

    Nov 3, 2003
    Atlanta, GA
    Full Name:
    Joe Bennett
    I had heard if you file electronically you have a higher chance of being audited. Anybody know the truth about this one?
  10. judge4re

    judge4re F1 World Champ

    Apr 26, 2003
    Never home
    Full Name:
    Dr. Dumb Ass
    Before my expat assignment, I always used Turbotax. Used to take me about 2 hours (and 3 cups of coffee). Very straightforward if you have 1) all of your forms organized and 2) like Dr. Tax said, your investment accounts properly set up.

    Now, I use the professionals. You would too if you had to file a monthly income return in China as well as all of your taxes in the USA.

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