You get what you pay for: the TaxAct episode

I finally bit the bullet and decided it was time to do my taxes. TaxAct seemed tempting -- free to try, pay when you file. So, I entered all the info into TaxAct. Mostly, I skipped the interview questions and filled out the forms directly -- my tax return mostly consists of entering information from various 1099s, so it's not all that complicated.

Initially, therefore, I didn't see much of a difference between TaxAct and its costlier brethren. Towards the end, though, the surprises started.  First, it said I owed the Alternate Minimum Tax (AMT). Well, that is possible, I suppose. And a rather stiff tax underpayment penalty.  However, I went and added quarter-by-quarter income and got the Federal penalty nearly waived. Still, TaxAct was of no help in this process. Whatever money you'd have saved by using tax software, you'd have lost if you didn't realize that breaking out your income by quarter could get rid of the underpayment penalty.

The Oklahoma return experience was incomparably worse.  Nearly to the finish line, I get this:
In case you can't read that, the software wants me to manually fill out some form and then enter the numbers there. If I have to manually fill out forms, why would I be using tax software, eh?

Now trying to decide if I should go to an accountant, or should do what I did in previous years and use Turbo Tax. What do you think?

UPDATE:  I repeated the whole exercise on Turbo Tax. When it comes to the AMT and figuring out underpayment penalties, Turbo Tax also sucks.  I went back and looked at TaxAct's final numbers and they were $115 lower.  I could not figure out what the difference was: I think it just comes down to how the two programs interpret the tax laws. Anyway, I filed using TaxAct.
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6 comments:

  1. Greg HollingsworthMarch 15, 2011 at 1:44 PM

    Valliappa,

    I'm sorry to hear that you're having trouble with TaxACT. Have you tried contacting our TaxPayer Support team? They may be able to help you figure out what's going on.

    You can get in touch with them via email here: https://www.taxact.com/tsupport/support_request.asp

    Sincerely,
    Greg Hollingsworth
    TaxACT

    ReplyDelete
    Replies
    1. UnknownMarch 28, 2014 at 11:46 PM

      I am so upset with TaxAct. When completing my 2012 federal return I entered my property tax information so I did not think that I had to actually select yes I want a property tax credit on the state return for it to be included; I am just realizing this mistake when using taxact for my 2013 return, lucky I caught it this year. The miss has costed me 6 times the cost of the software unless I file an amended return. Where are the alerts for this miss???

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    2. UnknownMarch 28, 2014 at 11:46 PM

      This comment has been removed by the author.

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    3. UnknownMarch 28, 2014 at 11:46 PM

      This comment has been removed by the author.

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  2. TracyMarch 15, 2011 at 10:19 PM

    I used TaxACT this year and I found it to work well for us, even with all the business use of the home stuff for my husband. I was tired of paying TurboTax prices and I doublechecked against what was filled out last year and couldn't see a big difference.

    ReplyDelete
  3. LakMarch 15, 2011 at 11:34 PM

    Updated to say that I ended up using TaxAct after all. Turbo Tax was no better once it comes to AMT and tax penalties.

    ReplyDelete

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