is now 
They are offered with many catchy names that sound like they can help you “defeat the enemy” of taxation, but beware.
Do-it-yourself tax preparation software can only help you as much as you already know.
Let us explain.
Recently we’ve been seeing a host of new clients who were audited by the IRS after they used tax preparation software to complete their own tax returns. The top issues that have been resulting in audits on self-prepared taxes include:
- Claiming deductions the taxpayer was not eligible for
- Miscalculating the amount of taxes owed
- Filing the wrong forms
- Filing the right forms with the wrong amounts
- Miscalculating amounts of income or deductions
- Misapplying tax credits
- Lacking proof to back tax credit claims
- Misunderstanding tax terms and calculations guidelines
- Missing or under-representing the amount of fees for late payment of taxes
The list goes on. Software with names like Intuit’s TurboTax®, TaxSlayer™, 2nd Story Software’s TaxACT®, and H&R Block’s TaxCut®, just to name a few, are meant to be tools to help in the preparation of taxes. aIf a taxpayer doesn’t know the right questions to ask or which forms are correct, they may miss vitally important information.
Often the “live” tax preparation specialists (if the software offers such assistance) have limited training on more complicated tax issues. They also do not have access to taxpayer records to make certain the right questions and issues are being discussed.
For taxpayers who file relatively simple forms, such tax software packages can be helpful. Last year, the IRS reports that 9.8 million tax returns were self-prepared and e-filed.
Taxpayers who file a Form 1040 with Schedule A with a state return and a non-itemized Form 1040 and state return may find tax preparation software a bargain for fast and easy filing.
Yet, taxpayers who have more than one income stream, multiple deductions and credits, or have endured a change in marital status, employment or suffered a major illness, face many different kinds of tax issues that require more in-depth review.
No one wants to face an IRS audit. Using a CPA as your qualified tax preparation specialist can ease headaches, decrease the chances that you’ll be audited, prevent costly errors and omissions, and restore peace of mind.
At McRuer CPAs, we fix “I did it myself” taxes. If you or someone you know is already struggling with tax preparation software, that’s a sign that it may be time to call a professional. We’re here to help. Give us a call at: 816.741.7882.
