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Slashdot Asks: How Do You Pay Your Taxes?
April 15, 2014 isn't just a full moon: it's Tax Day in the U.S. That means most American adults have already submitted a tax return, or an extension request, to the IRS and -- except for a few lucky states -- to their state governments as well. I filed my (very simple) tax return online. After scanning the free options, since I live in a state -- Texas -- that does not collect personal income tax, I chose Tax Act's free services. That meant enduring a series of annoying upgrade plugs throughout the process, but I could live with that; I have no reason to think it was better or worse than TurboTax or any of the other e-Filing companies, but I liked Tax Act’s interface, and it seemed less skeevy in all those upgrade plugs than the others I glanced at. The actual process took an hour and 19 minutes once I sat down with the papers I needed. My financial life is pretty simple, though: I didn't buy or sell a house, didn't buy or sell stocks outside of a retirement account mutual fund, and didn't move from one state to another. How do you do your taxes? Do you have an argument for one or another of the online services, or any cautionary tales? Do you prefer to send in forms on paper? Do you hire an accountant? (And for readers outside the U.S., it's always interesting to hear how taxes work in other countries, too. Are there elements of the U.S. system you'd prefer, or that you're glad you don't need to deal with?)
actually, my taxes do me.
HRblock.com makes pretty quick work of taxes, and it works seamlessly in aurora in Gentoo linux. The only downside is the constant upsell. at some point you're clicking quickly because you just want to get shit done and accidentally upgrade yourself to a $120 tax package. After that, you literally cannot back out or restart.
Good people go to bed earlier.
...it should probably be "How Do You File Your Taxes?", as the content has nothing to do with how taxes are paid, really.
I tried to efile a few years ago and discovered someone had already submitted a tax return under my SSN. So I had to send in all my tax forms and all my proof of identity in paper, along with a statement of fraud or something of the sort. And I had to file paper again the next year since my SSN was blocked from efiling due to the fraud alert.
Finally got the ability to file normally again last year. We don't qualify for the free tax software any more, unfortunately. I think we used the paid version of Turbo Tax.
Occasionally living proof of the Ballmer peak.
I have used Tax Act since changing from Turbo Tax when they tried to push a DRM version on us. This was a long time ago. I probably would not have changed except for that, but since then I have not looked back. With Tax Act I always buy the Deluxe Download for both my State and Federal taxes and that gives me a free e-file and unlimited paper filings. Over the years it has served me and my late wife well through the passing of both her parents and preparing their final returns and also my Father's passing and the issues with inheritance and estates. My tax preparation over the years has ranged from very simple to far more complex than I would ever have imagined and I have had to contact the Tax Act support via email on both technical issues of HOW to do something also Tax issues of WHAT I needed to do. I have always gotten very helpful and prompt responses and this year was no exception. Although I am moving more and more to Linux I am GOING to keep at least one Windows machine around just to run Tax Act if nothing else!
Suck it tax man, Accept my bitcoins!
Do not look at laser with remaining good eye.
The majority of people in the UK who work for an employer (rather than self-employed), and don't have other income to declare (e.g. part time self-employed in their own hobby business, renting out a property, or rich enough to be generating significant income from investments or savings) don't fill in tax returns, it is managed by their employer through Pay-As-You-Earn. As wikipedia says "because the tax code reflects other income (including the state pension), the PAYE system typically results in the correct amount of tax being paid on all the income of a taxpayer, making a tax return redundant".
Let the flamewar begin :-)
I like the UK system - if you're an employee and you're happy with the tax your employer has withheld on your behalf, you don't have to do anything. You get a statement at the end of the year telling you how much you've been paid and how much tax has been withheld - if you think they've got it wrong, or you want to claim deductions, you file a tax return saying so.
Slashdot - News for Nerds, Stuff that Matters, in ISO-8859-1 Has just realised that beta makes this signature redundant
Not an ideal solution, but it has served me pretty well. My taxes have been varying levels of complexity over the years and I liked having the same UI for handling a variety of needs. Free would be nice of course, but I consider the cost of the package (compared to the amount of money involved) worth it for the convenience.
Filing taxes is annoying enough, and even the "premium" options are just not that expensive for anyone in our field with a job (if you're not in that category, its a different story, obviously), that it just doesn't matter.
I do have a condo I just bought, I'm married, and I do have stocks, but using the appropriate TurboTax option, I basically just punch in some information, and it retrieves my W-2s and tax papers. Punching in the real estate data takes 5 minutes. So all in all, about 45 minutes for both people and forget about it.
Only annoyance was that the e-filling for stocks wasn't available for like, a month after I tried to file, so I had to wait a bit to submit the whole thing, but considering the amount the IRS wants from me, I wasn't in any particular hurry.
Here in Switzerland, canton Vaud, Tax Day was March 15. It is quite easy : you download a Java app from the government Web site. It works on Windows, Mac or Linux. You can open last year's return to prefill the relevant information, then you are guided through the application as to which fields you need to fill. When done, the electronic form is sent back, encrypted, to the government. In many cases, you do not need to join any other justification document, but they may ask you for them later. Usually, you do not need to send your salary statement either because your employer is required to send it directly to the government so they already have it.
If you just have one or two W2s and 1099 I find paper to be the easiest. I tried the eFile system and it requires you to type in all the codes on the W2s which is torture. 45 minutes and I'm done.
U.S. and California
I have a degree in mathematics. Tax returns and their computations are merely a simple mathematical puzzle, which I easily solve.
I created two spreadsheets, one for federal income taxes and one for state income taxes. The latter is linked to the former because much of the California computations require inputs from the federal forms. Each year, I copy the prior year's spreadsheets into a new folder. I download the fill-in PDF forms for both governments and update the spreadsheets accordingly. I mark in yellow the spreadsheet cells that require new inputs; as I input those data, I remove the yellow.
California provides a Web site where I input my taxable income and filing status. The Web site tells me how much tax to pay. I wish the IRS would do the same. However, it is much easier to input into the IRS PDF files than into the California PDF files.
Since I have a large investment in a mutual fund, I can also get Turbotax for free. I download it and use it to check my spreadsheet results. I don't really like Turbotax because it requires too much irrelevant input and because it does not provide adequate capability to include explanatory attachments.
I print the PDFs and mail them via U.S. Postal Service. I never request certified or registered mail. I mailed my first tax returns when I was 16 years old. I am now 72. I have never had a mailed return go astray.
Slashdot Asks: How Do You Pay Your Taxes?
I PAY my taxes with Bitcoins OBVIOUSLY!
How do you do your taxes?
I use TurboTax every year and have never been disappointed. One year I decided to try HR Block since they are stalwarts in the tax filing industry (Why does tax filing need an industry?) and I was mortified at the lack of professionalism from their online and support staff. They cost me extra money and wouldn't assist me in correcting the error they caused. The tax "professional" assisting me couldn't even understand the simple concept of adult dependent attending college which I'm pretty sure is a common deduction. Their 2014 ad campaign (Get your billion back) infuriates me.
"A person is smart. People are dumb, panicky dangerous animals and you know it." - K
Grudgingly. I guess that's international.
bickerdyke
I downloaded the workbook at excel1040.com, as I have for several years. I used a free version of TurboTax to validate the results. Once I was satisfied that I had entered everything correctly, I printed the relevant forms and hand-transcribed them to the IRS official forms. I mailed the paper forms yesterday. I try to print neatly, so that the poor transcribers (practically minimum-wage) at IRS can read the forms. In order to buy a version of TurboTax that would handle my federal and state returns, they wanted $140. I can't stand the thought of paying for the 'privelege' of filing my tax returns.
If it isn't true, don't say it. If it isn't helpful, don't say it. If it's true and helpful, wait for the right time.
I've e-filed for the past 10 years or so with all the major tax filing brands. Very easy and convenient; plus your returns are direct deposited so much faster. The only problem I've had was a couple years ago when I'd forgotten about several deductions and had to amend my return by mail (amounted to several hundred dollars as I recall).
My only complaint is that e-filing should be free software provided by the government and not commercial entities. Seems like that's the prerogative of the Feds, but those under a certain income bracket do get free filing and software.
I swear to God...I swear to God! That is NOT how you treat your human!
I needed an extension this year. Some tardy 1099s, an erroneous 1099-R, a K-1 (that MLP just wasn't worth the hassle), a bunch of self-employment income, and it all just snowballed. Last couple of years I've used an accountant, but done them myself as a check, and to make sure I understand what's going on. Our results have never differed by more than a couple hundred $.
In Canada our tax day is April 30th...it's actually been extended this year several days due to the Heartbleed vulnerability found on the CRA's (Canada Revenue Agency is equivalent to the IRS) electronic filing servers. Yes, about 900 SIN numbers (similar to your SSN) were compromised!
Personal income tax forms (T1) are submitted to the Federal Government which includes any provincial forms/schedules that may be needed. All employment income is reported on a T4 as submitted by employers to the CRA but more importantly to each employee used to calculate any over/underpayments. There a dozens of other T forms for different things like investment income, educations deductions, etc.
Personally I report employment income, investment capital gains on my non-registered retirement savings, and this year some capital gains on a stock I sold to pay for tuition. I also report and deduct any retirement savings from my taxable income (RRSP's and Pension like a 401k). Generally, I have about 6-10 different papers that I need to co-ordinate before I begin to calculate things.
I used to use Intuit's TurboTax software, then switched to the online version but always found the software/website to be somewhat hard to use and poorly laid out. This year I found out about a new alternative web tax software for Canadian Tax called SimpleTax.ca. It's designed much better, and is actually free to use, plus it's CRA Netfile certified meaning it's been checked and verified by the Government. They ask for an optional donation at the end, which I'm sure is just temporary until they build a client base.
Normally I get a refund of anywhere from a few hundred dollars to a few thousand depending on a number of factors such as EI, CPP and Income Tax overpayments PLUS the benefits of deducting registered retirement saving (this makes a huge difference).
Mark
I used H&R Block online. Unlike Intuit's offering, it doesn't complain that I'm using Linux. (Turbo Tax seems to work anyway after ignoring the warning, though.)
My financial life is pretty simple, though: I didn't buy or sell a house, didn't buy or sell stocks outside of a retirement account mutual fund, and didn't move from one state to another.
Trading stocks and funds in a non-retirement account used to be a huge PITA at tax time. Good news on this year's 1040 is that you can consolidate all your capital gains (or losses) by short and long term and avoid entering a line for every single trade. This quite literally saved hours of work.
I am not a crackpot.
Some countries don't even have personal income tax, and apart from the U.S. I don't know of any others that require their citizens pay income taxes on wages earned overseas. Admittedly several of the countries on the list are not the best places to live, but for non-USians it's perfectly possible to avoid paying income tax altogether.
UNIX? They're not even circumcised! Savages!
Germany here, but PAYE applies here too. It's similar for capital gains: The bank automatically sends your estimated taxes to the tax office. At the end of the year, you get a report. Exactly as you PAYE report, it contains a transaction ID which can be used to refer to those advance payments when you want or have to actually file your taxes. (If you can expect a refund, you may file one, if you have other income besides the advanced-taxed income, you have to)
bickerdyke
I started with MacInTax the first year it came out, and I've used tax software on a computer ever since. I used MacInTax and TurboTax until Intuit added DRM a few years back and mishandled things. I switched to H&R Block that year. However, if H&R Block ever does something idiotic, I will switch to whichever competing product does a good job. I have not tried any online tax software, but I have friends and family who do and they like it. In general, it takes me about an hour each year to do my taxes. I do have a mortgage and taxable investments (stocks, bonds, and mutual funds) and sometimes other income, but I live in a state without income tax, so that makes things go pretty quickly.
I think I chose 'Tax Act' based on price to e-file federal and state; but I was very displeased. Not so much by 'Tax Act', or even by the taxation(I, um, did my best to refrain from calculating how many years I'd need to buy Uncle Sam another slipped F-35 deadline, or a Literal Coffin Ship); but by the fact that I was, largely because of lobbying by Intuit and friends, paying to re-type numbers from a variety of forms the IRS already has. Seriously?
Yeah, sure, if you have some sort of complex arrangement get thee to a tax accountant, maybe even a suitable lawyer; but this was just redundancy for its own sake: I took a W-2 and a bunch of 1099s and a few other bits and pieces, all provided by various institutions to both me and the feds, and then retyped them into another form so that they could be submitted to the feds. WTF? That wouldn't even make sense for free, much less paying.
C'mon, IRS, just let me see what you think my return should be(you have to calculate it anyway when deciding who to audit) and I'll tell you if I have any changes or disputes. We'll both save time and trouble. How about it?
I use an accountant. Thankfully, I was ahead of the game this year and got everything filed a month ago.
But the worst part is getting the letter from the IRS saying that they'd adjusted my refund by $30 due to some minor error.
My feelings on the matter:
"If you knew how much money I was supposed to send in, WHY DIDN'T YOU TELL ME IN THE &@#$ING FIRST PLACE! It could have saved everyone time, money and trouble."
Lets start refering to The War Against Terror by it's initials. . .
That is how I pay my taxes. But I do pay them. That is how I pay my taxes. I do not see taxation as theft, as many conservatives, libertarians claim. I see government as a long term venture capitalist, who invests in the entire next generation of America. Some of them will strike it big, and others will strike out. If I am one of the fortunate group that was able to take full advantage of the investment the government made in me, investments that protected my earning potential and my property rights, then the tax I pay is just dividend to the venture capitalist. So despite all the reluctance and the pain associated with parting with my money, I know it is the right thing to do. The government investment in the next generation depends on it. I can invest better on my children, and the government investment is creating competitors to my children. If I believed in Social Darwinism, I will fight taxes tooth and nail. But I believe human beings should rise above this level of self interest and pay the taxes. --
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Here in Finland, the tax department sends me a tax card which tells how much to withhold each month based on my estimated yearly earnings, which I give to my employer. I later get a prefilled tax return based on my real earnings, which details any extra to be paid or returned. I check it, and if it's okay, I need do nothing.
A more cynical person might think a system where the market for tax apps or accountants for the average person exists is intentionally designed to make paying taxes difficult and aggravating.
Forget magic. Any technology distinguishable from divine power is insufficiently advanced.
IRS has the ability to do something similar, for those with relatively simple financial situations (not for real estate tycoons). However, Intuit has lobbied against allowing them to do so, as it would kill their parasitic business. A couple of articles:
http://www.republicreport.org/2012/corruption-taxes-fivemins/
http://techcrunch.com/2013/03/27/turbotax-maker-funnels-millions-to-lobby-against-easier-tax-returns/
If it isn't true, don't say it. If it isn't helpful, don't say it. If it's true and helpful, wait for the right time.
In the press a lot has been made of the Romney's and Obama's "effective" tax rate: that is, "Adjusted Gross Income/Total Tax = Effective tax rate". Romney's was something like 14.1% and Obama's was 20.4%. Populist rage ensued over both "not paying their fair share." I felt that same rage but then looked: my effective rate was 9.53%!!!! That sure surprised me.
So /.ers: look at your effective tax rate - are you higher or lower than these "greedy bastards"?
Annoyingly, I found out a couple of years ago that despite being a Canadian citizen and filing Canadian taxes every year, the US still considers me a US citizen for tax purposes, and so I have to file US taxes as well. Particularly annoyingly, one of the Canadian tax-deferral vehicles, the TFSA, is not recognized by the US, so I have this big complicated additional form to fill out for something it calls a trust. Plus I am CEO of a company I partly own (my consulting business), so I have to file financial paperwork for that as well. I hire an accountant, it's the only way to make sense of it all, and the US idiocy means that I'm out of pocket an additional $400 every year.
Ok, so what the hell!
A simle tax return hear in Australia done online with the free govermnt sofware ( http://www.ato.gov.au/Individu... ) takes a lot less then that, hell it even data matches your taxfile number and pre fills feilds for you to check, hell it picks up tax decatiable medical expsense that i didnt even relise I coudl of claimed! Add in your work mileage and year type of car, how many uniforms washes you do a year etc.. and your filled and done extremely quickly, and you get faster processing due to online submission.
Done in 1/2 hour, and it tells you how much you are getting back or own then and their as a damm close estimate. You guys have to pay cash for programs for your tax? Sounds like your government really is screwing you, Can you even claim that back on your tax, tax based expenses??
You have 5 Moderator Points!
Which Helpless Linux zealot/MS basher do you want to mod down today?
Just filed by TurboTax this year. Basically, this year has been STUPIDLY busy, and I've been working 7 days a week, and pulling an average of 12 hours a day.
So last night it kinda occurred to me, uh, maybe I should file my taxes?
Unfortunately I'm booked solid today. Ooops.
Now I've had my taxes done for me for the last 25 years (basically ever since I started working as a teenager). In all that time, I've only had one tax scare (due to my employer at the time screwing up my witholdings). So, regardless of how "easy" people say it is to file for yourself, I was always terrified of filing myself.
This time I didn't get a choice.
Luckily it was mostly pain-free. One small goof around educational witholdings (interest on college loans). But I got it filed.
And it's become cheaper, by far, to file this way than to have a service do it.
Now I just have to hope nothing got screwed up.
(I'll unclench my butt from my chair once the direct deposits go through.)
Chas - The one, the only.
THANK GOD!!!
I used to think Turbotax was a device for chopping flat fish.
Regardless, I use Turbotax through inertia and laziness. My taxes are a little complex - wife has a business, home office and all that malarky. I have stocks and options and RSUs and the broker never reports it correctly.
The inertia and laziness bit comes in where TT remembers the numbers from last year and displays them next to this year's. This is a good thing because it shows you the ballpark number you're looking for. If your home office utility costs are half of last year's, you've missed something.
The business (retail store, we live above it) tax logic is complex and TT has no clue how to handle that. You cannot throw a year of transactions are TT and have it work it out. It cannot distinguish a sale-of-goods from a class-registration-fee from an asset. Intuit would have you enter it all into Quickbooks manually (the import/export does not work, deliberately so), but QB sucks donkey balls. So the business tax logic is untangled in spreadsheets I developed.
When I get that automated and integrated into the point-of-sale software (that I wrote in python+curses for retro/modern geek points) my life will get simpler. But this requires the bank to use a consistent format so transactions can be tallied.
I should use this sig to advertise my book ISBN-13 : 978-1501515132.
People should have to see their tax burden all in one sheet. Really, we should all have to write a check or use cash to pay our taxes.
It should hurt. The more it hurts, the more likely people will vote for politicians who can control spending.
Most people have no idea how much they pay in taxes.
:wq
"Most people have no idea how much they pay in taxes." proof?
Even though I don't write a check, my tax software it kind enough to provide me exactly how much I paid in taxes, so that I can easily calculate my EffeciveTaxRate (19%)
What software do you use that adds up all your sales tax, property tax, fuel tax, and all the other taxes plus the fees that are passed on to you that are hidden in the costs of the goods and services you consume?
Yup, that's what I've used for the past three or four years. I just print directly from the spreadsheet, and it always works fine. I usually have to file a few extra forms, and I can download the PDFs from the IRS site. The PDFs are nice in that they let you fill in the data and then print them.
I considered buying software this year because it was getting complicated with figuring out accounting for rental property, but I had fun figuring it out myself.
I've set up a separate spreadsheet where I track all my expenses. One is for charitable giving, with a pivot table that gives a total by year. I have one for miles driven for charity, and the pivot table then gets added as an entry on the giving sheet, so I just have one number to copy to Schedule A.
I did the same for all my rental property expenses, adding a column for which line on Schedule E the expense goes on. The pivot table gives me the exact numbers to copy to the schedule.
Now for future years, it's all easy as long as I keep filling in the data every time we save a receipt. (I've considered scanning all the receipts and adding the images to cells in the spreadsheet, but that's too much work.)
Why in the world they don't let you submit PDFs online to them instead of mailing them on paper (only to be scanned back to electronic form), I have no idea other than lobbying from the tax preparation industry.
Federal Income Tax = 15%. And that included a special one-time deal. Otherwise it would be 12%. Standard deductions and credits. Nothing special.
And I am close to the top 10% of income. I still can't figure out why everyone complains so much about taxes. I find it quite fair.
I didn't include state because that is wildly variable from TX to NY to MT.
I finally updated my sig, but now it's lame.
How do I pay them? With a check to the IRS and sometimes the state (this year the state paid me $50 - woo).
So the real question: How do I file them? With an accountant. Why? Because I own rental property and even if you can do business taxes without an accountant, you're still better off hiring one. Why? Because you can expense it to your business (i.e. write it off), and write off your personal taxes as well, as long as you follow the IRS requirement that you are only going to an accountant because of your business. The best part is I spend 1 hour doing taxes each year, and the last year I did them myself I spent over 30 hours just looking up depreciating asset schedules (with rental property, all expenses are paid over a period of time, so a 5 year depreciating asset needs to be deducted at 1/5 the cost over 5 years - I had to find some items in the massive IRS tomes for these at my local library) and about 55 hours total (investment income was about 75% of the remaining time - played the Wall Street Lotto a bit too much that year).
Bottom line: if you own a business, hire an accountant.
They require you to use their credit card payment "vendor". Yeah that word has quotes in their description, so I'm sure Turbotax owns it somehow.
"Vender" charges 2.49% of your tax expenses just to let you pay online. So what should cost $0.25 to swipe a credit card online can be quite a lot depending on your payment.
Bye Turbotax. Also with their lobbying shenanigans and attempts to keep the tax code complicated they've just gotten higher than Comcast on my list.
Cwm, fjord-bank glyphs vext quiz
Tax day...? Tax day? Tax day! Oh shhhhiiiiiiii....!!!
I still can't figure out why everyone complains so much about taxes.
It's mostly because politicians tell them they're taxed too much and should complain. It has nothing to do with actual tax rates, just a way to make political hay that sounds good to a lot of low information voters.