Interested in joing forces and creating our own tax software?

[BOB W]

Free taxware????? Can't happen. At some point money comes into the picture. Besides how are you going to sell your subscriber base to Mr. Big.

[BOB W]

I have great respect for people that dive into developing tax programs and all that it entails. I would imagine that it would take several years before such a plan would be functional for preparer use. Each of those years' prototype would have to tested and tested for accuracy as a trial return.

I would think that once the forms and functions are set up (and working) it will be a matter of making adjustments to deal with current tax law (correctly). Difficult yes, but even the best of them still issue a warning>" We take no responsibility for errors and you will need to verify the results before the tax return is finalized" (or something like that).

Most new companies have an ulterior motive. Say 10 years from now it is hoped to have 5,000+ subscribers and its market value at $2,000,000+. Then along comes MR. Big to eat it up. Mr. Big is now Mr. Bigger.

Freeware???? Can't happen. Everything costs or will cost Money.

[erchess]

easy to edit is a problem

The IRS has strict requirements for tax software that are collectively designed to make sure if calculates things correctly and does not in any way make the taxing agencies' jobs harder. If I as the user of a software package make any change in that package then before I use it to prepare a return for pay or to electronically file even my own return I must get it approved. I am a fan of the open source paradigm for software development but I just don't see it working for tax software for individuals or professionals.

To the original poster - It sounds like you are a tax professional with good knowledge of writing software. You might well be able to develop a program for your own use and get it approved for use in 2010 on 2009 returns. If you want to make your code available to others, I would check with a knowledgeable attorney for liability issues first. You could also choose to sell your package. Tax Slayer is a company that started out writing software for its own offices and at some point started selling their products outside of their business.

I have only used your tax estimator once but its result is in line with what I calculated doing an estimate by hand. I personally think a tax estimator is a very fine idea for an open source software product. As far as I know, it is no more regulated by the government than most OS projects and the ability of those so inclined to tweak it would be a plus.

[Rchinchilla]

@ BOB W -

I have great respect for people that dive into developing tax programs and all that it entails. I would imagine that it would take several years before such a plan would be functional for preparer use.

Well this all pretty much depends on the community. Lets say we had at least 5 tax analyst such as yourselves to contribute your time, I'm talking about hardcore tax enthusiast, people that are "in the know" of tax changes, and 5 developers, we would have a prototype ready in no time. Ideally we would initially focus on the basic returns, this is what the tax estimator basically does, and then move on from there.

Most new companies have an ulterior motive. Say 10 years from now it is hoped to have 5,000+ subscribers and its market value at $2,000,000+. Then along comes MR. Big to eat it up. Mr. Big is now Mr. Bigger.

This is true. Many open source projects have been bought out by large corporations. XenSource was bought by Citrix last year for 500 Million USD. Top contributors became Citrix badged employees. MySQL was bought by Sun MIcrosystems for 1 Billion USD. However this was not the initial goal of these projects and that is not the idea of this project. The good thing is they still continue to develop and support an open source version that cost 'nada'. Let's not confuse freeware with open source.

[Rchinchilla]

The IRS has strict requirements for tax software that are collectively designed to make sure if calculates things correctly and does not in any way make the taxing agencies' jobs harder.

This is true for all software developers. They must meet guidelines, coding standards and deadlines.

If I as the user of a software package make any change in that package then before I use it to prepare a return for pay or to electronically file even my own return I must get it approved.

The idea is to collaborate on changes. If you feel strongly about a certain change others are probably feeling the same way. This change would then make its entry into the application.

If you want to make your code available to others, I would check with a knowledgeable attorney for liability issues first.

All software without limitation has something called an EULA (End User License Agreement). Here is a pretty common phrase used in all the professional software I have used.

Disclaimer Of Warranties. EXCEPT AS EXPRESSLY PROVIDED ABOVE, THE SOFTWARE, SERVICES AND TAX ADVICE ARE PROVIDED "AS-IS" AND, TO THE MAXIMUM EXTENT PERMITTED BY APPLICABLE LAW, "COMPANY", ITS AFFILIATES, LICENSORS, PARTICIPATING FINANCIAL INSTITUTIONS, THIRD-PARTY CONTENT OR SERVICE PROVIDERS, RETAILERS, DISTRIBUTORS, DEALERS AND SUPPLIERS (COLLECTIVELY, "SUPPLIERS") DISCLAIM ALL GUARANTEES AND WARRANTIES, WHETHER EXPRESS, IMPLIED, OR STATUTORY REGARDING THE SOFTWARE, SERVICES, TAX ADVICE, CD AND RELATED MATERIALS, INCLUDING ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE, TITLE, MERCHANTABILITY, AND NON-INFRINGEMENT. "COMPANY" DOES NOT WARRANT THAT THE SOFTWARE, TAX ADVICE OR SERVICES ARE SECURE, FREE FROM BUGS, VIRUSES, INTERRUPTION, ERRORS, OR OTHER PROGRAM LIMITATIONS.

Anyone who uses software generally agrees to this once they sign-in, install or download an application.

What we really need is some backing. Lets stay positive and lets get this rolling. Very simple for example, I have been working on a comparison chart for 2007 to 2008. Can you guys help me verify that I am not incorrect.
Here is the link.

http://apps.sourceforge.net/mediawiki/taxengine/index.php?title=2007-2008_Changes

I haven't received my new TaxBook yet.

Thanks,
Roger

[BOB W]

Suppose you do get people to contribute to this project how will their participation get recognized for any "down the road" rewards? I think you need a contractual agreement making them a partner for future sale or for a revenue stream if it becomes marketable.

(If TTB was to develop a tax program I'm sure many of us would use their program because our confidence in their product(s) would be there.)

It takes years to develop all the bells and whistles necessary to have a marketable program. But in todays world of "intergration" with other accounting programs, tax software is just a piece of the total needs of an accounting office. For Tax Preparers who only do 1040 it may be OK but even they could outgrow your program.

I guess I'm just spoiled with all the highend programs out there and I am willing to spend the bucks for them. To me, intergration saves me money.

[Rchinchilla]

Suppose you do get people to contribute to this project how will their participation get recognized for any "down the road" rewards?

I prefer to think of the immediate rewards, this way we don't set anyone's expectations to high. Its human nature to prefer immediate rewards opposed to "down the road" rewards. BOB W how much is your billable hour? You might say "I don't bill by the hour", suppose you did, what would it cost the client for one hour worth of your work, specifically tax research. If a project such as this would consume 10 hours of your time, do these 10 hours of your time equal what you spend on tax software annually?

What I am trying to say is that your reward would be an inexpensive tax software solution. The reason its inexpensive is because you and others contributed their time not only to research the subject matter but to convert it into the following:

//************************************************** *************************
//// Calculation For Tax Payer Self Employment Tax
// ************************************************** *************************
function CalcTPSETax()
{
global $Estimator;
//All rules for this section are located on Schedule SE Page 2
//$EN | Net Taxpayer Self-Employment Income = Taxpayers Self-Employment Income (minus) Taxpayers Self-Employment Expenses
$NetTPSEInc = FormatDollarAmont( $Estimator->tp_se_income) -
FormatDollarAmont( $Estimator->tp_se_expense);


//$EN | If the Taxpayers Self-Employment Income (times) 92.35% is under $400 than there is no tax.
if ( (0.9235 * $NetTPSEInc) < 400 )
{
$res = 0;
}
else
{
// $EN | If not then lets figure out the Taxpayer Self-Employment Base.
// Taxpayers Self-Employment Base (equals) 92.35% (times) the greater of 0 or the Net Taxpayer Self-Employment Income.
$TPSEBase = ( 0.9235 * max(0, $NetTPSEInc ));
//Now that we have calculated the TPSEBase we must calculate the result.
// Result (equals) 2.9% (times) the TPSEBase (plus) 12.4% (times) the minimum of either the TPSEBase or the maximum of the RefCTC_Threshold_Wages - Self Wages.
$res = FormatDollarAmont( 0.029 * $TPSEBase ) + FormatDollarAmont( 0.124 * min( $TPSEBase, max(0, (RefCTC_Threshold_Wages - $Estimator->self_wages))));
}

return $res;
}

But this code would not be easily generated if someone wouldn't put it in plain English. BOB W what I am saying is we need the tax professional communities help. If you aren't interested I can live with that.

[Bees Knees]

I was cynical at first. Why in the world would someone offer free tax software considering the huge amount of time and expense required with such a project.

Then I thought about what I pay for tax software. I just spent $1,500 renewing my ProSeries software (I was late in getting the early bird renewal price and free e-file). If I didn’t have to spend $1,000 or $1,500 per year, I might be willing to spend a few hours helping to contribute to a community based program where thousands of participants share in providing feedback on how it should work. As I understand it, these people are not asking us to be programmers. Simply provide feedback as professionals on how well it works.

I’m not sure what the programmers would get out of this project, but I know the benefit I might eventually get for my time. Free software would be the equivalent of having to do 15 to 20 tax returns for clients each year. It could be compared to the time we all spend on this message board giving away free advice to one another in exchange for the intangible value of the education we all get from participating.

[Rchinchilla]

Programming is an art form

Bees Knees - YOU HIT THE NAIL ON THE HEAD. I am not as eloquent as you are that's why it took me about 10 posts to say what you said in 1.

Some people may say "Well its free software, you get what you pay for", but as Bees Knees said many professionals offer SOUND advice that I would use any given day. The advice is free but it still holds a lot of value.

For example: Can someone help me with these questions.

What is the Education Credit cutoff for MFJ and for Non-MFJ? and where can this information be found?

For 2007 MFJ it was - $104,000
For 2007 Non-MFJ it was - $52,000

Is it the same this year?

[joanmcq]

Single, HOH, or qualifying widow(er) $58,000
MFJ, $116,000

[Rchinchilla]

Thank you joanmcq,

Where can I find the source of this information?

[David1980]

That information would be in the 2008 IRS Pub 17, available at http://www.irs.gov/pub/irs-pdf/p17.pdf
It would also be available in thetaxbook.

It would also be useful to take down this address:

http://www.irs.gov/taxpros/lists/0,,id=97782,00.html

That's the draft forms link at IRS.gov. So you could check draft forms for information before the final forms are released and then just update if they make any changes. Since a lot of tax development gets done before final forms are out it's useful to have.

[Rchinchilla]

David thanks for the link.
Found the source.
2008 Form 8863 Line 8

Roger

[Roberts]

Are you planning on state tax forms to be included? Tax software is worthless without state tax forms.

One of the problems with counting on professional tax preparers is that states and the federal government issue very late changes when the tax season is heating up. That's exactly when tax professionals don't have time to deal with software problems and updating the software code.

The idea of open source is great and all but tax software is extremely time sensitive in it's development and waiting even a week or two to issue updates can have massive implications. TRX Alliance is basically the cost of 2 relatively small tax returns. Considering the cost versus the concern of a complete software meltdown mid-February isn't worth it for me.

Last year I purchased TaxExact Pro for a few bucks to test it out. They promise delivery of software for all 50 states. April 1st they were at 15 states and one of those I did a return for was so flawed you couldn't even do the simplest of returns.

Good Luck with your project.

[Rchinchilla]

Roberts I understand what you mean. We are trying to develop with that in mind. Tax software is the only software of its kind, meaning updates are crucial and frequent. We are taking all of this into account while developing this software. Being open source creates the ability for a lot of eyes to see the underlying code. We are also going to be releasing tables that state the calculations we are using. Initially we do not recommend for this to be a production product but eventually it will be very powerful.

We understand that this is no easy task but if Intuit and CCH can do it, the tax professionals can certainly do it. There are more tax professionals that work independently than CCH currently or previously employed combined.

Please understand me, I have nothing against these companies they just don't offer what is needed. In many cases they don't handle things with sensitivity for example how these software companies have treated the clients of these products: Intellitax, ATX & ProSeries Express.