Posts in the ‘Taxes’ category

Start Thinking about Taxes

Tax season will be kicking off in a few weeks in the US. At least it will be for the proactive among us. Most of the rest won’t even consider their taxes until the second week of April.

I like tackling my taxes early and every year at about this time I am faced with the proposition of going with TurboTax (which I have used for over a decade) or switching to the cheaper TaxCut software from H&R Block.

Last year things came to a head when I found out that some of the investment tax wizards I needed were moved from TurboTax Deluxe to TurboTax Premier and I had to buy an upgrade in the middle of doing my taxes. It was pretty annoying, but it was easier to pay to unlock the upgrade than switch to a new software package mid-stream.

This year it looks like the people from H&R Block are really sweetening the deal by offering much more for much less in their assorted TaxCut software versions. The question is whether it is worth trying something new and risking having to start all over with a more expensive product later or simply going with the more expensive product that you know works.

I checked out the TaxCut Software Complete Features List and it appears that this software should do everything that I expect it to. But I will only find out by taking a chance and making the leap.

Does anyone have any advice? What do you use? How complicated are your taxes? Leave your thoughts in the comments section.

New York Provides No Relief to Overtaxed Teleworkers

In response to citizen outrage, New York made changes to it’s unfair and nonsensical telecommuter tax policy. However according to the Telework Coalition, the words may have changed but the impact is still the same: the vast majority of telecommuters will get no relief.

I first wrote about this topic back in November when the the Supreme Court refused to hear the case of a teleworker that lived in Tennessee and telecommuted for a company in New York. Although he worked from his home 75% of the time and worked in the New York office 25% of the time, the state of New York wanted to tax him on 100% of his salary. Because the case went unheard, New York got its way.

At this point, New York, New Jersey, Pennsylvania, and Nebraska have laws that allow them to squeeze telecommuters that work for companies within their boundaries even if the teleworker lives in other jurisdictions and never steps foot within the taxing state. Given the Supreme Court actions, or rather inaction, other states may be emboldened to balance their books on the backs of telecommuters as well.

Since New York has chosen to waste time with a PR move that does nothing to provide relief to the teleworker, it is time to take action. Contact your senators and representatives in Congress and ask them to support the The Telecommuter Tax Fairness Act (S. 1097, H.R. 2558).

You can reach your congressperson at http://www.house.gov.
You can reach your senator at http://www.senate.gov.

Tax Software! It’s that time again

We are fast approaching tax season and I begain making plans to pick up my usual copy of TurboTax so I could get a jump on things.

I have been using some version of TurboTax since the early 1990’s and it never occurred to me to consider another product… until this year.

Why the change of heart? Part of it is the increasing arrogance of Intuit. When I upgraded to Quicken 2004, I found that they had added advertising in the software. Now I can’t balance my checkbook without looking at an advertisement for a Quicken MasterCard or bill paying service. Didn’t I already pay for the product? Why should I have to pay to look at advertising?

In addition, in recent years they have added the Premeir version to the TurboTax line and moved some of the features I used to get in Deluxe to the more expensive version. I am just an average Joe, why should I need to shell out an extra 30 bucks on tax return software because I cashed in a few stock options?

This year, Intuit began including a state product in some versions of their software without the need for a rebate – which is good – but they stopped offering a rebate for free electronic filing of federal returns.

It was upon noticing these little details that I also happened to notice that the competing product, TaxCut, was about $20 cheaper, included the state product for free and still offered a rebate for free electronic filing of federal returns. Hmmm.

Now I am a creature of habit and I don’t like change, but an extra 20 bucks could get me a case of beer. Should I make the leap? I have always liked the TurboTax interface, does TaxCut compare in terms of ease of use? Does H&R Block, the makers of TaxCut, have to charge $20 less because their product is not as good?

I have questions. Who has answers? Leave some comments if you have experience with either or both products. This may be the year I buy both products and do a head to head comparison. Who wants to see that?

References:
TurboTax Total Tax Solution Deluxe 2005 with State Win/Mac
TurboTax Total Tax Solution Premier 2005 with State Win/Mac
TaxCut 2005 Deluxe + State
TaxCut 2005 Premium + State

More Taxes for Telecommuters?!

The United States Supreme court declined to hear a case involving a man that telecommutes from his Nashville home for a company based in New York. This leaves a lower court ruling intact that allows New York to fully tax 100% of the man’s salary.

Essentially, this ruling puts telecommuters that work for out of state companies at risk of taxation by multiple states. Currently only New York, New Jersey, Pennsylvania, and Nebraska have laws allowing this kind of taxation, but other states may pass similar laws to increase revenue. All is not lost, however, Congress is looking at a new law, the Telecommuter Tax Fairness Act, that may prohibit double taxation on telecommuters.

An article at CNET News goes into further details on the subject. Senators Dodd and Lieberman along with Representative Shay sponsored the Telecommuter Tax Fairness Act which is currently stuck in committee.