I broke a record this tax year

[Steelrolled]

I filed 2 days early. The 3 months of extra time I was given did me no good .

I'm usually one of those looking for a post office with late-night hours.

This time I field electronically even though I owed money. With interest rates what they are, it wasn't worth delaying another week or so by mailing in a check.

[Rhiannon12866]

1. Good for you!

I broke no records, got an extension, as usual. And I don't do my own taxes, not that it doesn't mean I don't get anxious and stressed about it.

[PoindexterOglethorpe]

2. Honestly, I don't understand the people that are just now filing.

We should all have had the paperwork needed well before the original April 15 deadline. What am I missing? Other than chronic procrastination?

I filed my taxes on March 23. I got my refunds, state and federal, within a week. Hooray!

I also use an accountant, and have for many years. Honestly, I can't understand why people will spend hours and hours struggling over their taxes when a professional can do it all in 45 minutes or less. It's well worth the fee.

[Steelrolled]

5. Chronic procrastination is powerful.

[captain queeg]

3. I have always filed in February or so as soon as I get my forms

But this year I knew I was going to have to pay due to a disbursement from my retirement, so I stalled. I sent it in electronically last Thursday. They didn’t waste any time collecting money, looks like the feds cashed it the next day. I’m supposed to get a state refund so that will help but I suspect that’ll take awhile.

[progree]

4. I had a tax pro do my taxes for 35 years, but was beginning to wonder if he was saving me any

Last edited Thu Jul 16, 2020, 03:36 AM - Edit history (1)

time, as I did a lot of prep before going in for the tax appointment, and then when I got my tax return back, I checked every input number and made sure they were all included and got to the right place (I assume the software can do the math correctly). Most years I did find a mistake or two (some due to miscommunication), and then have to interact to get it all corrected and re-checked.

He also in the last several years filed for an extension, and then waited until October before finalizing the taxes. I didn't mind the extension, but waiting until October was irritating to me that sometimes it was like with only a couple days to spare as he knows I go over it carefully and usually something needs to be changed, so there has to be time to do a round-trip or two in October. Also, by the time October rolls around, I've forgotten a lot of stuff, so have to get back up to speed. I let him know how I felt about it for the past 2-3 years.

Too many mistakes. The October thing. And some surprising lack of knowledge.

Edited to add - on assuming the software does the math correctly, well, actually, not always. In 2017 taxes, my preparer's software wasn't doing Form 8606 right, sigh. And I do some separate spreadsheet calculations to come up with my own tax calculations, to see if it matches what I'm getting back from the tax preparer or TurboTax, so it's a math check too.

Finally, in 2019 (to do 2018 taxes) I dumped him and did TurboTax for the first time. It sure didn't save me time, but I expected a learning curve the first year. This year with TurboTax went better, but probably didn't save me time either.

I filed my federal taxes electronically before April 15, but it wouldn't let me file my state (Minnesota) return because of a $1 penalty for under payment of estimated taxes. ONE DOLLAR, and Turbo Tax tells me I can't file electronically. So I just waited until a couple days ago to print it and mail it.

Some would call that procrastination, but OTOH, in the meantime if something was wrong with my federal return, it would likely be wrong with my state return too, so I could fix that easily since I hadn't filed the state return yet. I also contemplated talking to TurboTax and the state (Minnesota) about REALLY on not being able to file electronically over a $1 penalty, but decided to go ahead and just print and mail the dang thing in.

Oh, even though I filed my federal electronically back in April, I didn't pay my tax due until a couple days ago.

I had a $2 penalty for underpayment of federal estimated taxes, but fortunately I was able to file electronically anyway. But had I filed Form whatever it is to annualize my income (most of my income is in the 4th quarter), it said I would not be able to file electronically and I would have to mail it in. So I just ate the $2 penalty rather than going through all the work of filling out that annualization form and then have to print and snail-mail it in (at a cost in postage alone that comes near to $2).

[PoindexterOglethorpe]

6. There are lots of good reasons to file for an extension,

but then not getting it done until October strikes me as incompetence on the accountant's part.

I'd have dumped him long ago.

I am very happy with my guy. Yeah, I could probably do it myself and save his fee, but he takes about thirty minutes, tops, with me there in the office with him. So that's well worth it to me.

Oh, and he also runs all of the numbers through his calculator, which spews out a paper record, to make sure the computer is doing the math correctly.

Back in March, when I filed (on the 23rd to be precise) apparently everyone was still working at the IRS and I got my refunds, both state and federal, in less than a week.

[progree]

7. Yup. We had this discussion offline about 2 or 3 years ago, and I went into the complexity of the

tax return and all that. There's no way anyone can do it in under 2 hours, I'm not going to repeat all that again. Frankly, I'm not impressed by speed.

I also strongly believe in checking the return no matter who does it, because of the thing I'm required to sign at the bottom of the tax form -

"Under penalties of perjury, I declare that I have examined this return and accompanying schedules and statements, and to the best of my knowledge and belief, they are true, correct, and complete".

I can't honestly sign that without looking at it over, carefully. Having been an engineer and having supervised engineers and technicians (both very numerically intensive professions, at least in the particular line of work I was in), I know there always will be a certain error rate that differs from person to person, but it's there.

By going over the return carefully I also find things that helps me save on taxes in the future. Or even in the present, I have occasionally found an error that when corrected saved me money. And in general, I just understand taxes a lot better than if I signed whatever was put in front of me.

I'm glad that you feel it's working for you, and I feel what I'm doing is working for me.

But anyway, each to their own.

I really don't have the time to do a roundy-round on this, or on how dumb I was to keep this guy for so long, particularly given that we ploughed this furrow thoroughly 2 or 3 years ago, so I hope we can leave it at this.

[question everything]

8. Filing electronically these days it the only way to go

The IRS is sitting on more than millions paper returns that were not yet processed.

[progree]

9. Well, I hope this isn't the situation in Minnesota - TurboTax told me I couldn't file my MN return

electronically because I had a $1 penalty (ONE DOLLAR!!!) for underpayment of estimated tax. So I snail-mailed the damn thing a few days ago. (Complicating factor: I really didn't owe a $1 penalty, but I would have to fill out a form where I "annualize" my income to get rid of that penalty, and my time is worth more than a dollar that a good blue state like Minnesota needs anyway)

On 2nd thought, I'm not expecting a refund from MN though (I ended up owing money), so if it takes them months to process, no big whoop to me.

I also had a $2 penalty for the same reason on my federal taxes, but fortunately TurboTax let me file that electronically, which I did back in April. (I ended up owing them money too. And like the Minnesota case, I could have made the penalty go away by "annualizing", but I have better things to do with my time).

Ooops, forgot to mention if I did annualize, I would have to snail mail my return in, so that effort wouldn't save me the printing and postage anyway.

[Steelrolled]

10. I really don't like giving anyone electronic banking information.

I would rather pay with a credit card, but there is a surcharge to do that.

[question everything]

11. If you are using the IRS own program - if it has one, I think it does

it has your banking information.

[progree]

12. One can file tax returns electronically, and pay by whatever way one wants - they are 2 separate

operations.

If one pays by old-fashioned check, the check has all the bank information they need to withdraw funds, including the routing number and the account number.

Anyway, you got me thinking about how secure giving bank routing and account number is -- I read these 2 articles FWIW

https://pocketsense.com/can-withdraw-cash-business-account-8521380.html

https://www.thesimpledollar.com/banking/checking-and-saving/is-it-safe-to-share-bank-account-information/

The biggest takeaway for me was from the first article: "Consumer protection laws such as the Electronic Fund Transfer Act give you 60 days to dispute a fraudulent ACH withdrawal and recover the money."

I've been checking my bank and credit card accounts online weekly just to look for anything funny.

[Steelrolled]

13. Good to know

I did read some time ago that giving someone the routing number and account number is not that dangerous. But with a paper check, at least the IRS doesn't keep an electronic record of that information (presumably).