Taxes! Blergh!
April 2, 2012 6:13 PM   Subscribe

What would be the best way for me to go about doing taxes?

So in the past my mom (who has had some accounting experience, but is not a CPA) has done my taxes as well as her own and those of other family members. She is good at it-- at least the federal and NJ, where we live-- and it works for me because I'm really not good with numbers. Like, really, really, REALLY not good with numbers. I have an intense fear of getting audited, and with her that has not happened yet. I haven't been filing taxes for very long, and I didn't really know of any other options.

But in May of this past year I started working in NY while still living in NJ. To top it off, I collected unemployment in NJ for the earlier part of 2011, and I did start to pay off my student loans. My mom did my federal return and that seemed fine to me (I have yet to send it in, however), but when she did my NY return she came out with me owing a number that was really high and just didn't seem right. She and I got into an argument about it, and thus, I've decided to take it somewhere to get it done.

I'm just not sure where or how. I made an appointment at HR Block on Wednesday since they were literally the only place I could think of and they said they would be willing to look at my state returns, but I kept reading all this bad stuff about them online. I'm having a hard time trying to find good CPAs in the NYC/NJ area who would be willing to see me on such short notice. I know there's TurboTax, and I'd be willing to pay for it, but I'm not really confident about it because, again, I'm dumb with numbers and I'm not sure how simple it is or if they explain things to you or not.

I'm kind of freaking out about this, because I've never had to deal with this before, and it is kind of short notice. Is HR Block really that bad? Are there good CPAs in the NYC/NJ area? Would TurboTax help me? Will it be okay? What should I do?
posted by bookwibble to Work & Money (15 answers total)
I know there's TurboTax, and I'd be willing to pay for it, but I'm not really confident about it because, again, I'm dumb with numbers and I'm not sure how simple it is or if they explain things to you or not.

I have used TurboTax and I'm horrible at interpreting IRS forms. Their site basically leads you by the hand, so long as you have your W-2s and any other IRS-ish paperwork that banks and student loan companies, etc. may send your way. And if you use them every year, they keep your records on hand, which is a really nice feature.

I'll bet it is cheaper than HR Block, too, which I think takes a cut of your return, if you get one. TurboTax charges a flat fee.

You can use TurboTax and not have to pay, either, up until the end-point, when it will offer to file electronically. In other words, you can go through and fill out the TurboTax forms and see what kind of return or tax obligation you have coming. You only pay if they print out forms for you to mail, or if they submit them electronically. I'd say you have nothing to lose by checking it out, other than an hour of your time.
posted by Blazecock Pileon at 6:17 PM on April 2, 2012 [2 favorites]

TurboTax is exactly what you need. It's extremely simple to use. You don't need any particular knowledge about doing taxes — as the first comment says, it leads you through everything. It works with state as well as federal taxes. I always wait till the last minute and I always get done with my taxes in one relatively painless sitting with TurboTax.
posted by John Cohen at 6:20 PM on April 2, 2012

The only downside to TurboTax is that they own, and this year they seem to be pulling an eBay/PayPal deal to the extreme, where they cross-promote the hell out of, as well as other financial services they have advertising deals with. It's kind of annoying. But, again, there's no fee to pay until they file for you, so it's really just a nuisance factor.
posted by Blazecock Pileon at 6:21 PM on April 2, 2012

The whole point of turbo tax is that you don't need to deal with the numbers. You just answer their questions and it does the numbers for you.
posted by BlahLaLa at 6:25 PM on April 2, 2012

File an extension for now, then try to get this solved as soon as possible after tax season with the help of a CPA. You have a complicated situation -- I wouldn't worry about doing unemployment using TurboTax or even a two-state income situation, but both together just increases the complexity beyond my comfort zone. There are pitfalls here, and you'd be better off with someone who knows the score.

Without reciprocity, you should note, you can end up paying nonresident tax rates. That's probably why the NY numbers seem large. But make sure.

H&R Block is OK if you have a straightforward situation, but the plurality (at least) of their employees in any given year are newbies.
Disclaimer: I have done taxes professionally, but not for H&R Block. My opinion of H&R Block is my own.

I have an intense fear of getting audited

You should relax. The enforcement budget is smaller than it used to, and Congress made them stop doing the comb-through-every-detail "lifestyle audits" without justification back in the 90s. They are not looking for people making mistakes, they are looking for fraud, and in particular people taking deductions and exemptions they're not entitled to -- basically people who have a serious income and pay very little in taxes. Even with your situation, it's very unlikely that you'd be audited.
posted by dhartung at 6:26 PM on April 2, 2012 [1 favorite]

TurboTax is fantastic and surprisingly cheap.
posted by twblalock at 6:29 PM on April 2, 2012

TurboTax and the like (I prefer TaxHawk, but YMMV) make things simple for many people, but I'd personally be uncomfortable using them for a 2-state tax situation with unemployment with unemployment.

I know the feds let you file an extension very simply; not sure about NY and NJ. I think you should consider that so you can give yourself more than 15 days to sort this out with someone professionally and not feel rushed.

Also, you can call the IRS. They're actually quite friendly and helpful. Again, I don't know anything about NY or NJ state agencies, but the IRS itself just wants to work with you if you happen to file incorrectly. They're not going to rake you over the coals. These days, audits tend to be for people who ping their fraud warnings, not for your average person making an error in good faith on their return.
posted by asciident at 6:35 PM on April 2, 2012

If you made less than $57,000 last year, you qualify for the IRS's Free File program, which provides brand-name tax software to complete your federal return FOR FREE. Several of the companies also let you do one state return for free as well. You will probably have to pay for the second state return (I think when I moved in 2010 it was like 13.95 for the second state return).

You don't do any MATH yourself. The program asks you things like, "How many jobs did you have last year?" and "What number is in Box 4? Type the number." I consider myself basically dyscalculic and it was fine.

I've used the H&R Block software and the Liberty software, and they were both fine and I haven't been audited. Living in one state and working in another is super-common. So is getting unemployment. All these things have happened to people before. You can even file for an extension online for free. Don't pay H&R Block to fill out a state return for you when they can use basically the same software for free.
posted by Snarl Furillo at 6:41 PM on April 2, 2012 [5 favorites]

I love TurboTax but I am currently dealing with a software situation with them that relates directly to collecting unemployment and dealing with taxes in two states. It's not going well. TurboTax is awesome software but I'd be very cautious about using it with a two-state tax return.

You have other options: check the IRS' FreeFile page to get an idea of what vendors are out there (the vendors on that list provide free filing for federal taxes but often give a list of states that they give free filing for state taxes as well). The only one I don't recommend is TaxSlayer (I ended up owing money one year on some ridiculously low amount of income).
posted by librarylis at 6:41 PM on April 2, 2012

Nthing Turbotax, but there is also "H&R Block At Home" which is the strong #2 seller of this type. I suggest buying either in a store and get the version for "Federal plus State" or "Deluxe" which includes one State program. It will lead you right through, you will update it and download your State program online, and if you need a second State program, you will be prompted to buy and download it online.

If you go to the H&R Block office or store, they are using their corporate version of the same program that you can purchase yourself as "H&R Block At Home".

Right now, stores are having sales on these in the physical software box, with rebates and special offers, which is probably less expensive than buying the base program online or doing it all online then paying to file from their site. Available at Staples or Office Depot or Target and others.

Whatever you do, don't give up your bank account information. Mail a check if you owe or wait for a mailed check back if you get a refund. It's OK to e-file if you expect a refund but let them mail a check.

I suggest against the extension. Get it done and over with. If there is a problem they catch, they will send you a bill. If they owe you money they will send you a check. These programs make it highly unlikely there will be any error. If there is an error, you will have made a good faith effort on it all, and you can file an amended return later.
posted by caclwmr4 at 6:44 PM on April 2, 2012

Check your MeMail.
posted by foxy_hedgehog at 6:55 PM on April 2, 2012

Just go with H&R Block this year, for simplicity's sake, and set up a better plan for next year. I used H&R Block for years (including in NYC, with tricky taxes) and they were fine.
posted by The corpse in the library at 7:07 PM on April 2, 2012

I've done my own taxes at for the past 4 years. It's very easy since they take care of the numbers for you, and presents everything step by step. The interface is all online, too, so you don't need to install software. It's also not very expensive to file, cost me less than $20 to file both state and federal. I'm in no way affiliated with TaxAct (because I have a feeling this answer sounds like an ad for the service, haha). Good luck!
posted by starpoint at 10:32 PM on April 2, 2012

Why do you recommend not giving your bank account information, caclwmr4?
posted by Night_owl at 10:33 PM on April 2, 2012

I've used the IRS freefile (EZTaxReturn) for the last three or four years and it's worked fine for me, even in a year with a move, game show winnings from another state, and three jobs. They really break it down for you.
posted by mskyle at 7:05 AM on April 3, 2012

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