Software Review of:
TurboTax 

I have used TurboTax for the past four years and have never had a problem with the installation or use and tax year 2000 is no exception. Intuit has done an excellent programming job with this program.

Gripes? Yup — I absolutely hate to have shortcuts for various programs installed (AOL first and foremost). I just resent having them tossed onto my desktop as a price for using some other program. Well, I got that off my chest so let’s get on with the review.

I purchased TurboTax about six months ago in response to a mailing from Intuit. They promised that I wouldn’t be billed until the project shipped and they offered me free e-filing if I took advantage of the early commitment. (I filed electronically last year and had my refund in a bit over two weeks and the only reason it took that long was that a holiday weekend held up the processing). Since I wanted my money as soon as possible I took them up on the offer and got a free encyclopedia CD as well.

This tax program has the interview method as well as the “fill out the forms” method for you to choose from. I selected the interview method even though I have been trained to help others fill out their returns and am reasonably knowledgeable about the tax system. There are just too many changes made every year to keep up and the interview method seems most reasonable.

TurboTax starts with asking you if you wish to transfer data from other tax programs (MacInTax, TaxCut, TaxSaver and older versions of TurboTax) in order to reduce your time. The data includes employer identification numbers, personal data, and a host of other bits and pieces.

You are then given the option of importing data from a group of financial programs such as Quicken and also to obtain data from brokerage and mutual fund companies that offer such services.

The process of filling out the return is as easy as possible presuming you have your information available. If you are still waiting for a form or two to arrive, go ahead and fill in the data you have and you can easily see how much refund (hopefully) you have coming or (sob, sob) how much more you’ll have to pay. (I suspect, by now, you know how my return ended).

The interview will guide you to enter data as needed to complete the form 1040. It prompts you to consider all options and one of the nice things about computerized filing is that you only enter data once (such as name) and the program will insert it where required.

I followed the clear instructions and all proceeded quite nicely. I have some income from working, from a pension plan, from Social Security, interest and dividends as well as some mutual funds. The complex calculations for short-term versus long-term capital gains, gains versus losses, etc. were done without a hitch. The program explored every possible avenue to calculate the income and reminded me if some information seemed incorrect.

The possible deductions, credits and other methods to lower the adjusted gross income were probed in order to lower the total tax due and it was interesting to see the total change as the various deductions were listed.

The complexities of the capital gain/loss form were easily handled by TurboTax as it took the answers to the interview and put the figures where they were required. I did not import any of this data but I can easily see how convenient this feature will prove to be as we get more and more automated. 

If you have questions as you go through the program you have a superb “Help” system available both on the CD and on-line at the Web site. I consulted them a couple of times and the answers were easily understood and were, so far as I can tell, quite complete.

After I completed entering all the data, the program confirmed that I did, indeed, owe money. I used the built-in system to double check the forms for errors and had the opportunity to correct a couple that resulted from my mistakes, not the program. TurboTax also compared my return against those that were in my approximate income bracket to see how my deductions compared and pointed out those that were higher or lower than the average. 

TurboTax also sought out possible missed deductions and asked me about them. For example, since I have good health insurance, my expenses last year were considerably below the amount needed to reach a deductible level. Other areas that could impact on totals due were also queried such as state income taxes paid. 

Before I could finalize the process I was instructed to go to the Website and download the most up-to-date information and forms available since there were changes made after they burned the CD and the day I was ready to file. This is a good precaution built into the program to make sure that the return was properly filed.

Even after I discovered I would have to pay this year I chose to use the e-file system which was almost as easy as everything else connected with using TurboTax. I selected the appropriate option and the program lead me through the e-file system. 

I had to produce two facts from my 1999 form (adjusted gross income and total tax due) to prove to the IRS that this was my form. I filed the return following the prompts and was told that Intuit had received it and would process it to the IRS. This established the “postmark” for filing the return and the IRS has agreed to accept this electronic postmark as proof of on-time filing. This can be most valuable should you wait until the last minute before filing and beats having to drive to the post office and join the crowd. I had to use a credit card to pay for the filing but I also have a rebate form so the filing was free).

I was instructed to return to the program and follow up on the filing status in 24 to 48 hours. This time is used by the IRS to verify the acceptability of the information you gave them and to accept the return as filed. 

I used TurboTax to check the status about 25 hours later and was pleased to see the “Congratulations” message telling me that the IRS accepted the return. TurboTax then had me print out the confirmation, instructions for paying the balance due, and the form 1040-V (used to send in the check no later than April 16, 2001.

I was given several more options — including a chance to once again buy a state tax program and other investment programs — plus the ability to print out the return to keep in the file. I was offered a chance to pay the amount due by either using a major credit card (for a fee of course) or to set up a direct draft on a bank account to be executed on April 15^th, or to confirm I was going to send a check. 

This whole process took me about one hour to do from start to finish. I maintain a file folder with tax return documents received during the tax year and my wife keeps the receipts for charity deductions and totals them up for me in January of every year. 

The big key is to have the documents on hand as you start the program and TurboTax will lead you by the hand to complete the return accurately and effectively. I was well satisfied with the program (hated the results, but can’t blame Intuit for that) and recommend it highly.

TurboTax can be used to produce five different income tax returns which can help members of your family do their taxes as well. 

You can download TurboTax from Intuit’s web site for $39.95 which allows you to file one return electronically. Additional returns are $11.95 each. It is also available at various computer stores and should be selling for about $20 when this is published. 

Great program and well worth the money. It sure beat the old mark one pencil routine when it would take forever to organize the forms you needed — and you always had to go to the post office and get the one you needed but wasn’t available in the package you received from the IRS.