Slashdot Asks: How Do You Pay Your Taxes? 386
April 15, 2014 isn't just a full moon: it's Tax Day in the U.S. That means most American adults have already submitted a tax return, or an extension request, to the IRS and -- except for a few lucky states -- to their state governments as well. I filed my (very simple) tax return online. After scanning the free options, since I live in a state -- Texas -- that does not collect personal income tax, I chose Tax Act's free services. That meant enduring a series of annoying upgrade plugs throughout the process, but I could live with that; I have no reason to think it was better or worse than TurboTax or any of the other e-Filing companies, but I liked Tax Act’s interface, and it seemed less skeevy in all those upgrade plugs than the others I glanced at. The actual process took an hour and 19 minutes once I sat down with the papers I needed. My financial life is pretty simple, though: I didn't buy or sell a house, didn't buy or sell stocks outside of a retirement account mutual fund, and didn't move from one state to another. How do you do your taxes? Do you have an argument for one or another of the online services, or any cautionary tales? Do you prefer to send in forms on paper? Do you hire an accountant? (And for readers outside the U.S., it's always interesting to hear how taxes work in other countries, too. Are there elements of the U.S. system you'd prefer, or that you're glad you don't need to deal with?)
Comment removed (Score:4, Interesting)
Title is Not Properly Descriptive... (Score:3, Interesting)
...it should probably be "How Do You File Your Taxes?", as the content has nothing to do with how taxes are paid, really.
Had to do paper for a few years (Score:4, Interesting)
Finally got the ability to file normally again last year. We don't qualify for the free tax software any more, unfortunately. I think we used the paid version of Turbo Tax.
We don''t do tax returns in the UK,you insensitive (Score:5, Interesting)
The majority of people in the UK who work for an employer (rather than self-employed), and don't have other income to declare (e.g. part time self-employed in their own hobby business, renting out a property, or rich enough to be generating significant income from investments or savings) don't fill in tax returns, it is managed by their employer through Pay-As-You-Earn [wikipedia.org]. As wikipedia says "because the tax code reflects other income (including the state pension), the PAYE system typically results in the correct amount of tax being paid on all the income of a taxpayer, making a tax return redundant".
Let the flamewar begin :-)
Overseas comment (Score:5, Interesting)
I like the UK system - if you're an employee and you're happy with the tax your employer has withheld on your behalf, you don't have to do anything. You get a statement at the end of the year telling you how much you've been paid and how much tax has been withheld - if you think they've got it wrong, or you want to claim deductions, you file a tax return saying so.
In Switzerland (Score:5, Interesting)
Here in Switzerland, canton Vaud, Tax Day was March 15. It is quite easy : you download a Java app from the government Web site. It works on Windows, Mac or Linux. You can open last year's return to prefill the relevant information, then you are guided through the application as to which fields you need to fill. When done, the electronic form is sent back, encrypted, to the government. In many cases, you do not need to join any other justification document, but they may ask you for them later. Usually, you do not need to send your salary statement either because your employer is required to send it directly to the government so they already have it.
Paper and US Postal Service (Score:4, Interesting)
U.S. and California
I have a degree in mathematics. Tax returns and their computations are merely a simple mathematical puzzle, which I easily solve.
I created two spreadsheets, one for federal income taxes and one for state income taxes. The latter is linked to the former because much of the California computations require inputs from the federal forms. Each year, I copy the prior year's spreadsheets into a new folder. I download the fill-in PDF forms for both governments and update the spreadsheets accordingly. I mark in yellow the spreadsheet cells that require new inputs; as I input those data, I remove the yellow.
California provides a Web site where I input my taxable income and filing status. The Web site tells me how much tax to pay. I wish the IRS would do the same. However, it is much easier to input into the IRS PDF files than into the California PDF files.
Since I have a large investment in a mutual fund, I can also get Turbotax for free. I download it and use it to check my spreadsheet results. I don't really like Turbotax because it requires too much irrelevant input and because it does not provide adequate capability to include explanatory attachments.
I print the PDFs and mail them via U.S. Postal Service. I never request certified or registered mail. I mailed my first tax returns when I was 16 years old. I am now 72. I have never had a mailed return go astray.
Why... (Score:4, Interesting)
Slashdot Asks: How Do You Pay Your Taxes?
I PAY my taxes with Bitcoins OBVIOUSLY!
How do you do your taxes?
I use TurboTax every year and have never been disappointed. One year I decided to try HR Block since they are stalwarts in the tax filing industry (Why does tax filing need an industry?) and I was mortified at the lack of professionalism from their online and support staff. They cost me extra money and wouldn't assist me in correcting the error they caused. The tax "professional" assisting me couldn't even understand the simple concept of adult dependent attending college which I'm pretty sure is a common deduction. Their 2014 ad campaign (Get your billion back) infuriates me.
Income taxes? I'm an expat you insensitive clod! (Score:4, Interesting)
Re:What about capital gains or dividents? (Score:4, Interesting)
Germany here, but PAYE applies here too. It's similar for capital gains: The bank automatically sends your estimated taxes to the tax office. At the end of the year, you get a report. Exactly as you PAYE report, it contains a transaction ID which can be used to refer to those advance payments when you want or have to actually file your taxes. (If you can expect a refund, you may file one, if you have other income besides the advanced-taxed income, you have to)
Grudgingly reluctantly... (Score:4, Interesting)
Re:Tax Act vs Turbo Tax (Score:4, Interesting)
Although I am moving more and more to Linux I am GOING to keep at least one Windows machine around just to run Tax Act if nothing else!
Tax Cut (H&R Block) online works with Linux browsers. Turbo Tax online complains but works anyway. And Tax Act online at least let me start without any warnings. There really seems to be little difference in the online versions of these services vs the installable Windows program, FWIW to you. I replaced my Mom's XP with Ubuntu and switched her over from Turbo Tax for Windows to Turbo Tax Online. Except for the (apparently bogus) warning when first starting, it worked fine, and she didn't really notice a difference in the experience from last year.
The paranoid might be concerned about filling out their taxes online, but the truly paranoid would note that an installable program could just as easily "phone home" with your tax info, anyway.
Re:base it around my OS (Score:4, Interesting)
I've used TaxAct for quite a few years - it works well, and it's under ten bucks for most people. Heck, for a federal return it doesn't have to cost anything at all.
The IRS itself has gradually been making it easier to file directly with them, for free. Up until now my wife and I have fallen above the income cutoff they've artificially chosen; but it appears they've been gradually increasing their capacity over the past few years - I suspect, either next year or the year after, we all will be able to go to irs.gov and take care of it there. My taxes aren't that difficult, so having to use a paid service (or paper) just because I want to do them myself seems quite silly.
Re:base it around my OS (Score:4, Interesting)
Not to mention H&R Block made me pick between married/joint or married/separate at the beginning of the process, whereas when I did the calculations with a spreadsheet I could just change that input and see my tax calculated both ways (because either could be better depending on circumstances). H&R Block was able to figure out whether I should take the standard deduction or not; it should have been able to do the same for filing status.
A quick way on H&R Block software is to use the "go to" button to go back to the beginning and change the status. It will show the result on the calculation fairly quickly.