Turbo Tax vs. Tax Professionals

Turbo Tax vs. Licensed Tax Professional

From Andrew Stadler, EA

Thursday 5 Feb 2015 state of Minnesota announce they would no longer be accepting Turbo Tax files, state of Utah and Alabama quickly followed by end of the day 13 states stopped accepting Turbo Tax files. The primary reason all these state stop accepting Turbo is because of fraud issues. In March 2015 FBI launched an investigation in the security of Turbo Tax and just last week several individuals registered complaints that they did not receive their refund due to Turbo Tax security issues.

TurboTax is a computer program. It does not use intelligent design to pick out credits or deductions that you may be eligible for or to help you in tax planning. What you put in the computer is what will spit out. Last year, IRS determined that the average individual refund could have been $800.00 higher if individuals had taken all credits and deductions allowed.

Turbo Tax Security: Identity fraud and tax fraud is rampant. Think about this: If you use Turbo Tax you are willing giving your information: your social security number, address, your children’s names and date of birth, income details to this software company – What are they doing with this info? Do your really think Turbo tax is free? Turbo Tax make record profits last year - Billions.

Real Life Testimony what Turbo Tax cost taxpayer:

> A married couple owned rental property they using Turbo tax for years. Many mistakes on tax return costing them over $21,000.00 in refunds.

> A mother used Turbo Tax filing her and her daughter’s tax return. Mom asked us to review the tax returns, upon review we discovered several errors resulting in Mom’s refund going from $2,003.00 to $6,921.00

> Audit/Tax Court: Tax court case Brenda Bartlett vs. Commissioner: Brenda used TurboTax to complete her tax return; she had withdrawn funds from her retirement account and felt that she had input the correct information into TurboTax. The IRS fined her $8,734 plus tax of $43,668.00 for under reporting her income. She used the defense that she was relying on professional software Turbo Tax. Her argument did not hold up in tax court, and she ended up owing the IRS over $52,000.00 plus state income tax over $15,000.00.

Cost: A company called PC Novis conducted a study a few years ago and found that individuals who used software programs actually paid more for their Tax return preparation due to hidden fees. They paid more than what it would cost to go to licensed tax professional: an Enrolled Agent – America’s Tax Expert.

Security: Be very careful on who you are giving your very personal information to and you don’t want to be like Brenda, owing IRS thousands of dollars because you rely on software! Hire America’s Tax Experts - Enrolled Agents.