Money Saving Tip: Tax Preparation Software

 

 

 

I REALLY HATE over paying INCOME TAXES! For years I refused to spend money to help the government collect My Tax Dollars. In principal, the tax preparation software should be tax-deductible. (NOT in CANADA) I finally realized, trying to punish the government with having to sort through my mounds of paperwork was like “Cutting My Nose off to Spite My Face.” I was punishing myself more by spending hours and hours filing out tax schedules and forms. Imagine that I used to file seven paper returns for my immediate family plus help my friends with their returns. That is a lot of paperwork.

Accountants and tax preparers can charge exorbitant fees. Most people find filing their own tax returns very intimidating! The information that you need is on the CRA or IRA web sites, plus tax preparation software is almost idiot proof. Most software have a step by step instruction option that is really simple. All you have to do is answer questions and put a check mark in the box on all sources of income and tax-deductible items that apply to you. The step by step method also allows for filing joint returns.

Advantages 

• It  is nearly impossible to miss a tax deduction, just slowly read each question
• It offers tax saving tips, especially good for joint returns
• It makes you aware of deductions that you may not have known were available
• it even allows you to make corrections
• Helps tax planning for future returns
• Keeps track of unused deductions to be carried forward to future years, like capital gains losses
• Allows you to set up direct deposit for your tax refund, you could get a refund in 10 days
• Gives you the option to file on-line or print a paper return for mailing.

Disadvantages

• May not be worth the cost for low-income individuals or for going only one simple tax return

Just remember that even if you use a professional to file your business or personal return, you are still responsible for any filing mistakes. You are liable for all penalties and taxes owed.

A hard lesson that I learned about accountants:

Would you be surprised to learn that I fired my first accountant? He used to comply my business income statements and file my corporate income tax return. He failed to advise me on some tax saving strategies for my company and for me personally. The next two accountants that I used were bombarded with tax saving questions almost every time we got together. Over time, the list of questions got smaller but my tax savings got larger! If you don’t ask, accountants tend not to tell!

Disclaimer: Please do your own research on tax preparation software.

 

 

A recent article from FORBES:

FBI Investigates Tax Fraud Reports As TurboTax Denies It’s A Target

“As concerns about stolen data and tax identity fraud continue to mount, it’s clear that this isn’t an issue restricted to Minnesota. Or Utah. Or Connecticut. With that in mind, it’s no surprise that the Federal Bureau of Investigation (FBI) has reportedly opened an investigation into a potential computer data breach related to fraudulent tax returns filed with TurboTax software.”