Using Tax Software vs. A CPA
By Larry Betts
A computer is a tool. As with any tool, if you are not experienced you must be aware of dangers. It is the old adage Garbage In = Garbage Out. Using software without knowledge can be treacherous and expensive. We have reviewed numerous tax returns prepared by non-accountant individuals using tax software. Almost all should have been amended or corrected. Most people think they are saving money. That is possible for easy returns such as a child’s. However, when potential deductions and credits are left off returns, it will most undoubtedly become a more expensive production. An incorrectly filed tax return can make the IRS look into past and future years to see what else is wrong. Many times additional tax, interest, and penalties are levied.
Tax laws constantly change. It is hard enough for tax professionals to keep track. For the regular taxpayer it is almost impossible.
Lastly, a tax professional is one that keeps up with tax law changes and is educated in their application. Seasonal preparers from “those” companies are little better than buying an off the shelf tax software product. We have seen their returns also. If all you want is a basic return with little or no understanding of your complete tax situation then feel free to visit them. By the way, the fees we have seen being charged are in no way bargains.