Sunday, March 28, 2010

Tax Time

We just finished our taxes — in record time. We started around 8:30 last night. Yes, we also turned out all the lights for Earth Hour, but as my husband pointed out, "With TurboTax, you're always in the dark anyway." (We unplugged our laptops, too. His, with the TurboTax, was fine for the whole hour; mine died after 8 minutes. I really need a new laptop.)

It's true, TurboTax isn't any more difficult to use in the dark, although you can't read anything in your tax files without a flashlight. So we used one when we had to enter W-2 and 1099 info, etc.

Our efforts were fueled by a chocolate cake from Lyndell's. It is impossible to even think about doing the taxes without a layer cake in the house (we should deduct the cost along with the tax-prep software...). Most years, it takes us at least one agonizing weekend and a few weeknights — with lots of shouting and frustration — to complete our taxes. (I also have to file a Pennsylvania form, which usually baffles the hell out of me.) Cake gets us through the rough spots and has saved our marriage.

Last night, we ate our cake in the dark. When we turned on the lights at 9:30, I realized that cake that is eaten unseen doesn't count. You must see your cake and eat it, too. But I didn't have another slice because I figured I'd have it for breakfast today, when our work resumed.

The worrisome thing about TurboTax is that it asks you a zillion questions but it doesn't take you through the forms and schedules in any linear order. (You also can't do searches, which is highly annoying.) So you have to trust that it is completing all the information, just as we trust that the financial reports it grabs from our Fidelity accounts are accurate. If there are errors, there's really no way we can know that. Just as there is no way we could ever figure out how to add all that Fidelity info ourselves to a paper tax form.

For that, we'd have to hire an accountant to do our taxes. Which is what we did until 2003, when we switched to TurboTax. We realized we couldn't trust an accountant, either. For our 2001 taxes, she ignored our list of all the estimated taxes we'd paid, and told us we owed a big chunk of taxes. We wrote the check. Then we got a huge refund from the IRS, with a sternly worded letter telling us never to pay our taxes twice again, or we'd be fined. For that accountant's expertise, we paid something like $1,200. Hello, TurboTax.

Either we're getting smarter or TurboTax is getting easier, but we finished our federal forms in about 3 hours. With no shouting (minimal swearing). At around 11, I realized that I'd forgotten to add my self-employment tax payments in the same boxes with my estimated income-tax payments. Adding those sums boosted our refund nicely, so I went to bed in a cheerful mood, despite knowing that the state taxes were looming over our heads in the morning.

But those were fairly straightforward, too. I mean, when we don't know the answer to a question —because it makes zero sense to us, and we've stared at it for 15 minutes trying to bend our brains around it, and have also read all the related answers to questions other people have asked about it — we tend to surrender and answer "No." It's is the easy way out and hopefully the correct answer,  as well. We have probably missed small deductions related to Massachusetts municipal bonds and foreign stocks in our mutual funds, but I would rather have a lower refund than spend another minute trying to figure out how to unravel and declare that stuff.

Digging out the Pennsylvania forms from last year helped me fill out this year's; I was done in under 15 minutes.

So what are we going to do with all that leftover cake? Freeze it for next year? Then it would become a carryover depreciated business expense, right? I can't be bothered. We'll finish it now.

1 comment:

  1. Great strategy! My husband and I met our accountant to review our taxes last night and stopped at our favorite bar for dinner on the way home. Good food makes taxes go down way easier.

    Except now I have a craving for cake.

    I'm enjoying your blog and your writing! Amy sent me your way.

    ReplyDelete

I love getting comments and do my best to follow up if you have a question. I delete spam, attempts to market other websites, and anything nasty or unintelligible. The cats and I thank you for reading — and please do leave a comment that isn't spam, etc.